In this edition of Asia Insights, we highlight areas in public equities, private investments, real assets, and hedge funds where we continue to find opportunities, despite the current environment of higher rates and market uncertainty.
This publication presents manager performance for 36 asset classes and substrategies, showing the median, mean, and key percentiles of return. Relevant indexes for each asset class are also included to provide market context.
Calendar year 2022 witnessed multi-decade record inflation and central banks responded with rapidly tightening monetary policy. Rising rates saw the correlation between bonds and equities turn positive, contributing to large declines across most asset classes. Funds flows diverted away from growth and momentum strategies, and yield curves flattened with the ten-year/two-year yield curve becoming inverted in most developed markets, signaling economic uncertainty ahead.
Capital markets remained volatile during fourth quarter 2022. Risk assets appreciated significantly during October and November before giving back some of the gains in December. Three consecutive quarters of positive returns and outperforming most other strategies came to an end for macro hedge funds during the quarter.
We expect macro hedge funds to perform well, given our expectations that market volatilities will remain elevated and our view that inflation risks are skewed to exceeding expectations. We expect long/short managers will benefit from positive short rebates.
This publication presents manager performance for 37 asset classes and substrategies, showing the median, mean, and key percentiles of return. Relevant indexes for each asset class are also included to provide market context.
The American Rescue Plan Act of 2021 included substantial relief funds for the most troubled US multiemployer pension plans through its Special Financial Assistance (SFA) program. This paper looks at how multiemployer plans have a unique opportunity to improve their solvency through 2051 and beyond by optimizing how they invest both SFA relief funds and their existing plan assets.
Asian markets have had a difficult year, but while the current environment has been challenging for most investments, it has also created an opportunity for more defensive and diversifying strategies to add value. In this edition of Asia Insights, we focus on the case for Asia quality strategies within public equities; increased interest in India and Southeast Asia venture capital markets; private infrastructure and private credit as defensive strategies; and the value in Asia macro and equity long/short.
Equity long/short investing is one of the most widely adopted strategies by hedge fund managers in Asia. Its importance has increased over time, and we believe that this strategy can play a key role within a global hedge fund portfolio. There have been several positive developments in recent years that build the case for investors to allocate to the strategy, including better market access, continued alpha opportunity, and a greater talent pool.
This publication presents manager performance for 37 asset classes and substrategies, showing the median, mean, and key percentiles of return. Relevant indexes for each asset class are also included to provide market context.