Active listening, inventive thinking: Tackling the toughest investment challenges.
For more than three decades, the Investment Solutions Group (ISG) has developed asset class-spanning products and services aimed at realizing our clients’ diverse goals. Today, we serve clients around the world, with more than $234 billion in assets under management and under advisory/consulting.*
We provide a wide range of investment solutions, from implementing short-term, tactical exposures to fully discretionary mandates (also known as “Outsourced CIO”). Here are some of our key multi-asset offerings:
Recent economic data points to a broadening of, and acceleration of, global growth led by developed markets. The biggest threat to strong near-term growth is likely on the supply side, where bottlenecks and labor shortages have kept inventories slim. But this is merely a delay, not a chink in the amor of an improving global economy. Overall, we continue to expect the macroeconomic backdrop to remain supportive.
Our longer-term asset class forecasts are forward-looking estimates of total return and risk premia, generated through a combined assessment of current valuation measures, economic growth, inflation prospects, ESG considerations, yield conditions as well as historical price patterns. We also include shorter-term return forecasts that incorporate output from our multi-factor tactical asset allocation models. Outlined below is the process we use to arrive at our return forecasts for the major asset classes.
Over the last decade, inflation has been subdued around the globe and struggled to come close to central bank targets despite loose monetary policy actions. However, influenced by the economic effects of the global pandemic, inflation appears poised to re-emerge in 2021 and to have an impact in the years to come.
Planning for a scenario with an inflation surprise has come back on the table in response to the COVID-19 related historic stimulus. Keeping this in mind, it may be prudent for investors to include an allocation to real assets to increase the diversification of their portfolio so as to mitigate unexpected inflation’s potentially adverse outcomes for growth and asset values.
* As of June 30, 2019. Total AUM of $211B excludes execution-only LDI. Derivatives-based exposure management AUM represents the notional value of exposure managed. Assets under advisory/consulting of $23B includes mandates for which the firm provides advisory or consulting services supporting an investment management process that does not include the responsibility to arrange or effect the purchase or sale of securities and/or funds.