A Preference for Taking Risk in the Credit Space
ISG “Alpha Meeting” Notes for August 10, 2020
Each month, the State Street Global Advisors Investment Solutions Group (ISG) meets to debate and ultimately determine a Tactical Asset Allocation (TAA) that can be used to help guide near-term investment decisions for client portfolios. By focusing on asset allocation, the ISG team seeks to exploit macro inefficiencies in the market, providing State Street clients with a tool that not only generates alpha, but also generates alpha that is distinct (i.e., uncorrelated) from stock picking and other traditional types of active management. Below are some of the highlights from the ISG team’s most recent “Alpha Meeting”
Asset Class Views Summary
We have extended our underweight to equities and shifted to credit within fixed income. We continue to allocate the majority of our risk budget to relative value positions, favoring US large cap within equities and credit over government bonds within fixed income.