Pixabay CC0 Public DomainWilliam de Gale, gestor del BlueBox Global Technology Fund. William de Gale, gestor del BlueBox Global Technology Fund
ACCI, asset management firm specialized in systematic strategies through its ACCI Dynamic fund family, has signed an exclusive agreement with Swiss fund manager BlueBox Asset Management to distribute its BlueBox Global Technology Fund in Latin America and Iberia (Spain, Portugal and Andorra).
In a press release, the firm has revealed that this 5-star Morningstar rated fund is managed by William de Gale, who was Portfolio Manager for 9 years for the BlackRock World Technology Fund. It was launched in March 2018 and has been backed by a broad range of institutional investors, which has allowed it to recently surpass 500 million dollars in assets under management.
In ACCI’s view, this is possible thanks to its differentiated approach among other strategies in the sector, largely avoiding mega-caps and focusing on enabler-type companies, with strong balance sheets, profitability and strong cash generation. It is a UCITS fund, available on the main trading platforms such as Allfunds, Inversis and Pershing, among others.
“This partnership with BlueBox will strengthen our product offering aimed at institutional clientele in Latam South and Iberia, adding a solid and consistent strategy such as BlueBox’s, with average annual returns of over 31% and 141% since its launch just over 3 years ago”, Antonio de la Oliva, Head of Distribution at ACCI, commented.
Gely Solis, Co-Founder of BlueBox Asset Management, said that this agreement with ACCI, “who have proven their impressive distribution capabilities in key regions” for us, will serve to broaden their investor base, consolidate their growth and “give access to a unique strategy such as BlueBox to a broad typology of investors in the region”.
ACCI continues its commitment to offer a wide range of high value-added strategies to institutional investors, complementing its own strategies with distribution agreements with outstanding alpha-generating asset management firms.
Pixabay CC0 Public Domain. Jupiter AM nombra seis nuevos analistas para sus equipos de estrategias de inversión
Jupiter AM has announced in a press release the hiring of six new analysts within its sustainable investing strategies, doubling the size of the existing resources and “adding fresh investment expertise to key portfolios”.
The asset manager has highlighted that its sustainability suite of funds offers clients a range of differentiated investment options with a shared goal of generating attractive returns through long-term sustainable investing. Following a strategy refresh earlier this year, Abbie Llewellyn-Waters was appointed as Head of Sustainable Investing, working with Rhys Petheram, Head of the Environmental Solutions team.
The firm is now strengthening its offering with the appointment of new analysts. Specifically, Maiken Anderberg joins the Global Sustainable Equity team as Equity Analyst. Having previously interned with Jupiter’s Sustainable Investing team in 2018, she is returning to the company in a new permanent role, working closely with Abbie Llewellyn-Waters and analyst Freddie Woolfe with a dedicated focus on the Jupiter Global Sustainable Equities strategy
The Jupiter Global Sustainable Equities strategy was launched in 2018 to offer clients an alternative to mainstream global equities by combining financial returns with positive environmental and social returns – enabling clients to participate in the transition to a more sustainable world.
Joining Jupiter in a newly created role, Noelle Guo has beenappointed Equity Analyst of Environmental Solutions. Supporting fund manager Jon Wallace and reporting into Petheram, she will work across the equity strand of Jupiter’s environmental solutions suite. Guo has eight years of equity research experience, joining from an Investment Analyst role at Pictet Asset Management before which she was at AB Bernstein as a Senior Research Associate.
Laura Conigliaro has been named Analyst of the Environmental Solutions team. Having joined Jupiter in 2019 as a member of Jupiter’s Governance and Sustainability team, she will now work directly with fixed income specialist Petheram with a particular focus on fixed income verification, also providing sustainability research into the desk’s environmental impact themes. Prior to joining Jupiter, Conigliaro has held roles at the Inter-American Development Bank and sustainability management consultancy Critical Resource.
Jupiter’s Environmental Solutions suite of funds boasts a 33-year track record and over 890 million pounds in AUM across the Jupiter Global Ecology Growth and Jupiter Global Ecology Diversified funds, and UK onshore vehicles. The strategy looks to invest in companies intentionally focused on providing solutions to sustainability challenges across key environmental themes.
In an internal move, Jenna Zegleman joins the teams as Investment Director. Having arrived at Jupiter in 2018 as a product specialist, she will provide client-facing support across the full range of portfolios in the Sustainable Investing suite.
In addition to these hires, Anisha Arora and James Kearns have joined Jupiter’s Governance and Sustainability team. An emerging markets economist and strategist with 10 years’ experience across sell side research and buy side asset management, Arora joins from Allianz Global Investors and has experience in applying ESG considerations to macroeconomic analysis, as well as to the sovereign debt investment process. Kearns joins Jupiter from BNP Paribas, where he worked initially in CSR within their Global Markets division before moving to become a Sustainable Finance Analyst.
“As we navigate through this global pandemic, the importance of confronting the climate crisis, bridging social inequality and ensuring a sustainable future is more important than ever. By investing in companies leading a sustainable transition across our Global Sustainable Equities and Environmental Solutions strategies we are able to offer our clients a range of attractive and truly innovative solutions that deliver positive outcomes for planet, people and profit”, Abbie Llewellyn-Waters, Head of Sustainable Investing, commented.
Meanwhile, Stephen Pearson, CIO, added: “We are pleased to make these appointments to the team as we continue to grow Jupiter’s sustainability suite, helping us continue to innovate and build on our long heritage of sustainable investing. We are delighted to be making these appointments at this important point in time, cementing support for these key strategies with the addition of specialist insight and investment expertise.”
Andrew Clifton, especialista de cartera de la estrategia T. Rowe Price Funds SICAV Global Value Equity Fund. Andrew Clifton, especialista de cartera de la estrategia T. Rowe Price Funds SICAV Global Value Equity Fund
Over the past ten to fifteen years, value stocks have fallen out of favor with the markets, dramatically underperforming the market. However, according to Andrew Clifton, Portfolio Specialist for the T. Rowe Price Funds SICAV Global Value Equity Fund strategy, from the last quarter of last year, the stars began to align for a recovery in value stocks following the announcement of vaccine developments and the hope of reopening economies and growth, against a backdrop of extremely accommodative monetary and fiscal policies.
The valuation discounts with which stocks have been penalized have been as extreme as those seen almost 20 years ago, with the technology, media, and telecommunications (TMT) bubble in the late 1990s.
Furthermore, the market environment has been positive for value stocks. The strong sell-off experienced in the first quarter of 2020 created opportunities for value managers. Value stocks have clearly rallied over the past 8 – 9 months, particularly since early November. But at T. Rowe Price they still believe that allocations to value equities will continue to generate good returns thanks to the available opportunities and the fact that their fundamentals remain positive.
Examining the potential of value stocks requires taking a long-term perspective. Much of the market only looks at what has happened in the last 10 to 15 years, but if you look over a longer period, value stocks have been generating positive returns for many decades.
According to T. Rowe Price, the last decade, in which value investing has performed poorly, has been the anomaly. So rather than thinking that the value approach is a temporary affair which only works occasionally, many investors need to realize that value investing has a solid foundation and fundamentals. Basically, if you can buy a company for less than its fundamental value, you are talking about a sound investment foundation.
From a tactical point of view, stocks have rallied, but the environment remains quite positive for value. are still trading at a material discount to their longer term 15-year average levels. Also, if you assess the market’s valuation dispersion, it has narrowed from last year’s extremes but is still above normal levels.
In terms of valuation, the expected price earnings multiple over the next 12 months for the MSCI World Value is 16 times, compared to 30 times for the MSCI World Growth. Therefore, there is still a large gap in valuations across all markets globally. Value continues to trade at a discount to growth, which provides a good opportunity for value investors.
Looking at fundamentals and momentum, economies are showing signs of rising inflation over the next 12 to 18 months. The debate now centers on whether it will remain high or whether it will be only transitory. Interest rates will most likely start to rise over the next 2 years. The financial sector is a key player in the value universe and banks are the main beneficiaries of an improvement in interest rates as long as economic fundamentals remain positive.
The Importance of Interest Rates
Technically, if interest rates start to rise, it will reduce the future value of the more distant cash flows which are used to value companies. Many of the growth companies are not generating profits now but are banking on their potential long-term earnings. If interest rates rise, so will discount rates, but it should lessen the attraction of companies that have a long duration and instead favor those companies that are currently generating good levels of return, and this criterion applies to many value companies.
If interest rates cannot fall any further, the debate centers on whether they can either remain at their current levels or increase, the financial sector could benefit in both cases. In the case of banks, at T. Rowe Price they still believe that many banks, particularly in the U.S., will continue to have attractive valuations, as the economy improves, they can generate more capital and growth, and their valuations are already attractive at current levels. To some extent, there is a free option on the possible increase in interest rates at some point. According to the expert, it is not something that will happen overnight, but at some point, it will come to that because interest rates cannot fall below current levels.
Types of Value Stocks
Looking at the higher quality stocks, those that are referred to as “free cash flow” companies because of their ability to generate cash flows, are companies with good balance sheets that are going through a period of greater uncertainty or a problem that has raised concerns in the market. This provides an opportunity for T. Rowe Price’s managers who are looking for these types of opportunities in sectors such as pharmaceuticals or healthcare, where there may be some concern among some companies about losing patent protection or the possibility that drugs in development may not generate the expected profits in the future. At T. Rowe Price they work with analysts to understand the reality of a market and if they perceive that there has been an overreaction, new positions would be added to the portfolio.
Other examples of stocks with high cash flow generation are the utilities, which may have a more defensive bias, but may face uncertainty regarding regulation or capital allocation, and the consumer staples sector, where there may be concern about new market entrants.
On the “Deep Value” side are companies with lower balance sheet quality and higher levels of risk which, even if they have been bought at a significant discount, still have the potential to fall in price if the situation worsens beyond expectations – sometimes these are not just operational risks, they can also be financial or strategic risks, which is why at T. Rowe Price they strive to understand them better than the rest of the market. However, should the situation develop positively, they also have greater upside potential. When the strategy favors a greater weighting in “Deep value” stocks over cash flow generating stocks, they are trading a higher level of risk for greater upside potential.
Positioning by Country and Sector
Since the global economies began their reopening process, the T. Rowe Price Funds SICAV Global Value Equity Fund strategy has had greater exposure to emerging markets, Japan, and Europe and a lower weighting to the United States. The main reason behind this positioning is the greater efficiency of the US market in reflecting the recovery of the economy in share prices.
At approximately two-thirds, the US has a dominant position in the MSCI World Value index. However, at T. Rowe Price they prefer to include some exposure to emerging markets, with around a 10% weighting. The lower weighting of the US against the index funds their position in emerging markets.
By sector, they have maintained an overexposure in the financial sector since the launch of the strategy. T. Rowe Price believes that the market structure is particularly positive for US banks, in stark contrast to their counterparts in Japan and Europe.
The IT sector generally has a growth bias, but this does not imply that T. Rowe Price’s strategy does not have exposure to some segments. For example, the semiconductor industry has undergone structural changes that have not been appreciated by the market, which has continued to value them as cyclical companies. This is something that the management company has perceived as an opportunity. They have recently reduced their portfolio exposure from 10 to 6 names, the main reason being that valuations are already at their peak, with little upside left.
The Inclusion of ESG Factors
Value investing tends to have a higher ESG risk by its very nature, because it is more likely to have a higher carbon footprint, for the production of real assets, or to have a higher volume of fixed assets than a growth company, in which patents and software development have a greater weight. This increases the importance of integrating ESG criteria into the investment process. To this end, T. Rowe Price has an integrated team of ESG analysts.
When it comes to managing downside potential, there is always a risk of falling into a “value trap”. This risk is increased when investing based on valuations and ESG risk factors are one way to assess these value traps. In some cases, the market may overly penalize a security, presenting opportunities to invest. One example is Volkswagen, which a few years ago was embroiled in an environmental and ethical scandal over its vehicle emissions, but over the years its business model has undergone a transformation, and T. Rowe Price believes it will be one of the winners in the electric vehicle market.
M&G has announced that Fabiana Fedeli will lead its 57 billion-pound (78.4 billion-dollar) Equities division from the newly created role of Chief Investment Officer. She will report to M&G’s CIO, Jack Daniels.
In a press release, the asset manager has highlighted that the appointment follows its commitment a year ago to revitalize its active equity investment capabilities, “which has focused on delivering more consistent investment performance and developing strategies to meet evolving customer and client needs”.
M&G has a rich heritage in active equities investment; from launching the UK’s first mutual fund in 1931 and continuing to develop innovative strategies since then, including the recent launch of a range of impact investment strategies to tackle global challenges such as climate change and healthcare.
With over 20 years of experience in the investment management industry, Fedeli joins from Robeco Asset Management where she was Global Head of Fundamental Equities; leading an international investment team managing a range of active equity strategies. She had direct portfolio management responsibility for three of those strategies and has extensive experience of integrating sustainability and impact into investment processes. Prior to Robeco, Fedeli held a number of roles both in portfolio management and equity analysis in London, New York and Tokyo.
“Equities will always have an essential role to play in an investor’s portfolio and we believe that active equity management will deliver greater value for clients over the long-term. Fabiana’s appointment demonstrates our commitment to this vital asset class, bringing a wealth of investment experience in both equities and sustainability. Fabiana will be working with M&G’s talented team of investors, to promote greater collaboration, idea-generation and innovation across the Equities division”, Daniels, CIO of M&G, said.
Meanwhile, Fedeli pointed out that M&G has “a long heritage in active equity management, a strong culture and clear investment values”. In her view, as the industry continues to evolve, it remains imperative for asset managers to anticipate and respond to their clients’ needs. “I look forward to working with the talented and experienced investment team to continue to develop M&G’s equities proposition”, she concluded.
Foto cedidaZeno Staub, CEO de Vontobel. Vontobel AM completa la compra de TwentyFour AM tras adquirir el 40% restante de la boutique
Vontobel Asset Management has completed the purchase of TwentyFour Asset Management after securing the remaining 40% of its capital. After acquiring a 60% stake in the fixed income boutique in 2015, Vontobel had intended to buy the remaining 40% in two tranches in 2021 and 2023. However, it has beaten its own deadlines and has already accomplished the operation.
In a press release, Vontobel AM has explained that it has taken “targeted steps” in recent years to develop a diversified range of products for its clients, and one of the main pillars was the acquisition of a majority stake in TwentyFour Asset Management LLP (TwentyFour), now a 24.2 billion swiss francs specialist fixed income boutique. Both firms have now agreed that Vontobel will have acquired the remaining 40% in one tranche as of 30 June 2021.
TwentyFour and Vontobel are thus underscoring the very positive development of the partnership. “By bringing the transaction forward it gives clients and investors clarity and ensures focus remains on delivering outstanding performance and client service for the long term”, the statement said.
After the transaction, TwentyFour will remain operationally independent and will continue to service its clients from offices in London and New York, as well as via Vontobel’s international network. Since the acquisition of the majority stake of 60% in 2015, all TwentyFour Partners have continued to play an active role in the company’s day-to-day operations. Besides, the asset manager has highlighted that the partners and portfolio management teams “remain committed to serving the interests of clients and ensuring the investment boutique’s ongoing success, hence will continue to serve as a driver of growth for Vontobel”.
Both parties have agreed not to disclose the purchase price but have revealed that the acquisition of this stake will be fully financed out of Vontobel’s own funds. Part of the transaction will be paid in the form of Vontobel shares, further underscoring the commitment of TwentyFour’s Partners.
“From the very beginning, we have been impressed by TwentyFour’s expertise and entrepreneurial culture, as well as its continuous growth. The acquisition of the remaining 40% stake is therefore the logical next step in our diversification and growth strategy. I look forward to our ongoing collaboration with our colleagues at TwentyFour, who are all supportive of this acquisition,” stated Zeno Staub, CEO of Vontobel.
Mark Holman, CEO of TwentyFour, claimed that after six years of working very closely together with Vontobel as a majority shareholder, the decision to move to full ownership was not a difficult one. “As a direct consequence of our partnership we have been able to spread our investment expertise to a far greater audience as we have moved from being a domestic player to genuinely global. Importantly though we have preserved the independence and entrepreneurial spirit of being a boutique, which I know is something that both our clients and staff really value and was at the core of our decision making for this transaction”, he added.
TwentyFour was founded in 2008 as a partnership, and has since grown to employ around 75 staff, responsible for providing a broad range of fixed income products to institutional investors. It is known for its disciplined investment philosophy and its proven investment process that generates sustained attractive risk-adjusted returns. The firm’s funds have been rated by Morningstar, which has assigned 99% of them (asset weighted) a four- or five-star rating. Furthermore, the quality of its products has been recognized by a variety of industry awards.
Foto cedidaWilliam Davies, CIO para EMEA y responsable global de renta variable, y próximo CIO global en enero de 2022.. William Davies asumirá el papel de CIO global de Columbia Threadneedle
Columbia Threadneedle Investments has put its Global Chief Investment Officer transition plan into action. The asset manager has announced the retirement of Colin Moore, who currently holds this position, after nearly 20 years at the firm. He will be replaced by William Davies, currently EMEA CIO and Global Head of Equities, in January 2022.
The firm has highlighted the “key role” that Moore has played in shaping its global investment capability, including its “well-established and highly successful investment process based on collaboration across asset classes, research intensity and independent oversight to foster continuous improvement.” Under his leadership, Columbia Threadneedle has generated consistently strong long-term investment performance for individual and institutional clients, and today has 103 four- and five-star Morningstar-rated funds globally.
“I would like to recognise and thank Colin for his numerous contributions, including establishing our global investment capability that has delivered an enviable track record of consistently strong investment performance for our clients. We have built an outstanding and experienced team of more than 450 investment professionals across our global footprint, and as we look forward, William is well positioned to assume the Global CIO role. He is both an exceptional investor and respected people leader with a deep understanding of our firm having joined us in 1993. I look forward to working with William and Colin to ensure a smooth transition”, said Ted Truscott, Chief Executive Officer of the firm.
Meanwhile, Mooreclaimed to be grateful for the opportunity he’s had to establish a broad and deep investment capability for their clients. “We have spent considerable time ensuring a thoughtful succession, and I am extremely pleased that William will assume the Global CIO role next year. It has been a privilege to lead our team of dedicated, experienced investors who will continue to focus on delivering consistent, competitive investment performance for our clients under William’s leadership”, he added.
Lastly, Davies commented that his focus is unchanged: “I will continue to work with my colleagues to consistently deliver the investment performance our clients expect. I am honoured to lead our talented global investment organisation and look forward to continuing our partnership with colleagues across the business to help our individual and institutional clients achieve their investment goals.”
Pixabay CC0 Public Domain. JP Morgan AM compra Campbell Global, firma especializada en gestión e inversión en el sector forestal
In an effort to directly impact the transition to a low-carbon economy and provide ESG-minded investment opportunities related to climate, conservation and biodiversity, JP Morgan Asset Management has acquired forest management and timberland investing company Campbell Global, LLC.
Although the terms of the deal with Campbell Global’s parent company, BrightSphere Investment Group, were not disclosed, the asset manager has stated in a press release that the acquisition does not impact current investment strategies for Campbell Global clients. It also revealed that the transaction is expected to close in the third quarter.
Campbell Global is a recognized leader in global timberland investment and natural resource management. Based in Portland, Oregon, the firm has over three decades of experience, 5.3 billion dollars in assets under management and manages over 1.7 million acres worldwide with over 150 employees. JP Morgan AM has indicated that all employees will be retained and Campbell Global will remain headquartered in Portland.
The deal will make the asset manager “a significant benefactor for thriving forests around the world”, including in 15 U.S. states, New Zealand, Australia and Chile. Carbon sequestration in forests worldwide will play an important role in carbon markets, and the firm expects to become an active participant in carbon offset markets as they develop. Besides direct access to Forestry sector, the transaction will provide alignment UN Sustainable Development Goals and Principles of Responsible Investing.
“This acquisition expands our alternatives offering and demonstrates our desire to integrate sustainability into our business in a way that is meaningful. Investing in timberland, on behalf of institutional and high net wealth individuals, will allow us to apply our expertise in managing real assets to forests, which are a natural solution to many of the world’s climate, biodiversity and social challenges”, said George Gatch, CEO of JP Morgan AM
John Gilleland, CEO of Campbell Global, commented that they have always held that “there should be no tradeoff” between investing wisely and investing responsibly. “We made our first institutional investment in timberland 35 years ago, have since planted over 536 million trees, and emerged as a leader in sustainable forestry. We look forward to continuing these efforts with JP Morgan. Importantly, this transaction further positions Campbell Global to serve our existing world-class clients at the highest standard“, he added.
“Acquiring Campbell Global provides us with an opportunity to strengthen and diversify our ESG focus, including building a robust carbon sequestration platform,” said Anton Pil, Global Head of J.P. Morgan Global Alternatives. “Timber investing further enhances our asset class offerings in our alternatives business, ultimately passing along the unique benefits of forest management to our clients. Our knowledge of real estate and transport markets, in particular, is expected to provide opportunities to optimize the usage of timber and wood products more vertically.”
The investment offering will sit within JP Morgan’s Global Alternatives franchise, with 168 billion dollars in AUM, and will tap into the continued growth of private markets. JP Morgan is an expert in investing in real assets, with leadership positions in real estate, infrastructure, and transport and as well as private equity, private debt and hedge funds. In their opinion, Campbell Global adds to this portfolio, filling an asset class gap in an attractive market while also supporting sustainability goals.
Pixabay CC0 Public Domain. Más ricos y más acaudalados: el crecimiento de la riqueza se mostró inmune al golpe de la pandemia mundial
Wealth creation in 2020 was largely immune to the challenges facing the world due to the actions taken by governments and central banks to mitigate the economic impact of COVID-19. This is the main conclusion of the twelfth “Global Wealth Report” recently published by Credit Suisse Research Institute.
The analysis shows that total global wealth grew by 7.4% and wealth per adult rose by 6% to reach another record high of 79,952 dollars. Meanwhile, aggregate global wealth rose by 28.7 trillion dollars to reach 418.3 trillion at the end of the year. However, widespread depreciation of the US dollar accounted for 3.3 percentage points of the growth. If exchange rates had remained the same as in 2019, total wealth would have grown by 4.1% and wealth per adult by 2.7%.
The research institute points out that overall, the countries most affected by the pandemic “have not fared worse in terms of wealth creation”. In this sense, the pandemic had a profound short-term impact on global markets in the first quarter of 2020: the report estimates that 17.5 trillion dollars was lost from total global household wealth between January and March 2020, equivalent to a fall of 4.4%.
However, this was largely reversed by the end of June. “Surprisingly, in the second half of 2020 share prices continued on an upward path, reaching record levels by the end of the year. Housing markets also benefitted from the prevailing optimism as house prices rose at rates not seen for many years. The net result was that 28.7 trillion was added to global household wealth during the year”, highlights the analysis.
“The pandemic had an acute short term impact on global markets but this was largely reversed by the end of June 2020. As we noted last year, global wealth not only held steady in the face of such turmoil but in fact rapidly increased in the second half of the year. Indeed wealth creation in 2020 appears to have been completely detached from the economic woes resulting from COVID-19“, said Anthony Shorrocks, economist and report author.
The regional breakdown shows that total wealth rose by 12.4 trillion dollars in North America and by 9.2 trillion in Europe. These two regions accounted for the bulk of the wealth gains in 2020, with China adding another 4.2 trillion and the Asia-Pacific region (excluding China and India) another 4.7 trillion.
Another key finding of the report is that India and Latin America both recorded losses in 2020. In this sense, total wealth fell in India by 594 billion dollars, or 4.4% in percentage terms. This loss was amplified by exchange rate depreciation: at fixed exchange rates, the loss would have been 2.1%. Latin America appears to have been the worst performing region, with total wealth dropping by 11.4% or 1.2 trillion.
Meanwhile, total debt also increased by 7.5% and the report points out that it would likely have increased much more if households had not been obliged to save more by the constraints on spending. Specifically, it rose markedly in China and Europe, but declined in Africa and in Latin America, even after allowance is made for exchange rate depreciation.
“Windfalls from unplanned savings and prevailing low interest rates saw a revival in housing markets during the second half of 2020. The net result was a better-than-average year for homeowners in most countries”, it adds.
Global wealth levels in 2020
Wealth impacts of the pandemic have differed among population subgroups due to two main factors: portfolio composition and income shocks. The wealth of those with a higher share of equities among their assets, e.g. late middle age individuals, men, and wealthier groups in general, tended to fare better. Homeowners in most markets have seen capital gains due to rising house prices.
“If asset price increases are set aside, then global household wealth may well have fallen. In the lower wealth bands where financial assets are less prevalent, wealth has tended to stand still, or, in many cases, regressed. Some of the underlying factors may self-correct over time. For example, interest rates will begin to rise again at some point, and this will dampen asset prices”, Shorrocks commented.
The report also shows that there have been large differences in income shocks during the pandemic. In many high income countries the loss of labor or business income was softened by emergency benefits and employment policies. In countries with an absence of income support, vulnerable groups like women, minorities and young people were particularly affected
Also, female workers initially suffered disproportionately from the pandemic, partly because of their high representation in businesses and industries badly affected by the pandemic, such as restaurants, hotels, personal service and retail. “Labor force participation declined over the course of 2020 for both men and women, but the size of the decline was similar, at least in most advanced economies”, it adds.
Wealth distribution and the outlook
Wealth differences between adults widened in 2020. The global number of millionaires expanded by 5.2 million to reach 56.1 million. As a result, an adult now needs more than 1 million dollars to belong to the global top 1%. A year ago, the requirement for a top 1% membership was 988,103 dollars. So, as Credit Suisse Research Institute highlights, 2020 marks the year when for the first time, more than one percent of all global adults are in nominal terms dollar millionaires.
Besides, the ultra high net worth (UHNW) group grew even faster, adding 24% more members, the highest rate of increase since 2003. Since 2000, people with wealth in the range of 10,000–100,000 dollars have seen the biggest rise in numbers, more than trebling in size from 507 million in 2000 to 1.7 billion in mid-2020. “This reflects the growing prosperity of emerging economies, especially China, and the expansion of the middle class in the developing world”, says the report.
Global wealth is projected to rise by 39% over the next five years, reaching 583 trillion dollars by 2025. Low and middle-income countries are responsible for 42% of the growth, although they account for just 33% of current wealth. Wealth per adult is projected to increase by 31%, passing the mark of 100,000 dollars. Unadjusted for inflation, the number of millionaires will also grow markedly over the next five years reaching 84 million, while the number of UHNWIs should reach 344,000.
Nannette Hechler-Fayd’herbe, Chief Investment Officer International Wealth Management and Global Head of Economics & Research at Credit Suisse, claimed that “there is no denying” actions taken by governments and central banks to organize massive income transfer programs to support the individuals and businesses most adversely affected by the pandemic, and by lowering interest rates, have successfully averted a full scale global crisis.
“Although successful, these interventions have come at a great cost. Public debt relative to GDP has risen throughout the world by 20 percentage points or more in many countries. Generous payments from the public sector to households have meant that disposable household income has been relatively stable and has even risen in some countries. Coupled with restricted consumption, household saving has surged inflating household financial assets and lowering debts. The lowering of interest rates by central banks has probably had the greatest impact. It is a major reason why share prices and house prices have flourished, and these translate directly into our valuations of household wealth”, she concluded.
Pixabay CC0 Public Domain. BlackRock adquiere el modelo de escenarios de cambio climático de Baringa Partners
BlackRock and Baringa Partners have announced their entry into a definitive agreement for BlackRock to acquire and integrate Baringa’s industry-leading Climate Change Scenario Model into its Aladdin Climate technology. In a press release, both firms pointed out that this new long-term partnership is “a significant milestone” for them, as they collaborate to set the standard for modelling the impacts of climate change and the transition to a low carbon economy on financial assets for investors, banks and other clients.
Both companies believe that, while the reallocation of capital to sustainable investment strategies continues -with over 2.3 trillion dollars of assets under management in sustainability funds globally as of the first quarter of 2021- understanding the potential impacts of climate change and the transition to a low carbon economy on their portfolios remains a complex challenge for investors. With the number of governments and companies making commitments to achieve net-zero continuing to grow alongside increased regulatory requirements for climate-related disclosures, companies and investors alike are seeking solutions to help assess climate risk.
“Investors and companies are increasingly recognising that climate risk presents investment risk. Through this partnership with Baringa, we are raising the industry bar for climate analytics and risk management tools, so clients can build and customise more sustainable portfolios. The integration of Baringa’s models and the ongoing collaboration between our firms will enhance Aladdin Climate’s capabilities, helping our clients understand transition risks in more sectors and regions than ever before”, commented Sudhir Nair, Global Head of the Aladdin Business at BlackRock.
Meanwhile, Colin Preston, Global Head of Climate Solutions at Baringa said that climate change is “the number one challenge and opportunity of our generation”. Having developed the leading Climate Change Scenario Model, they are “excited to partner with BlackRock” to accelerate the adoption of this solution by organisations across the globe. “The integration of Baringa’s Climate Change Scenario Model into BlackRock’s Aladdin platform will inform the reallocation of capital across the global economy, accelerating the transition to net zero”, he concluded.
As for BlackRock, it began developing Aladdin Climate to fill a void in climate risk analytics by creating technology to help clients better understand and mitigate the financial impacts associated with climate change on their portfolios. Aladdin Climate is offered through the Aladdin platform and is used by BlackRock’s Financial Markets Advisory (FMA) group to deliver sustainability advisory services to clients. It measures both the impacts of physical risks, like extreme weather events, and transition risks – such as policy changes, new technology, and energy supply – at the financial instrument and portfolio levels.
Foto cedidaJoanna Munro, consejera delegada de HSBC Alternatives.. HSBC AM integra todas sus capacidades alternativas en una única unidad de negocio
HSBC Asset Management has announced in a press release that it is bringing together all of its existing alternatives capabilities under a single business unit, HSBC Alternatives, with a 150-strong team and combined assets under management and advice of 53 billion dollars. Joanna Munro has been appointed CEO HSBC Alternatives to lead the new combined unit.
The firm’s alternatives assets have doubled over the past four years and they believe that the creation of a single business unit is the next step in its strategy “to reposition the business as a core solutions provider and specialist Asia, emerging markets and alternatives asset manager”.
HSBC Alternatives will comprise of HSBC Alternatives Investments (HAIL), which includes the multi-manager Hedge Fund and Private Market teams, as well as the firm’s Private Debt, Venture Capital and direct Real Estate teams, with existing capabilities in the UK, France, Germany, Switzerland, Hong Kong and the US.
Munro, currently Global CIO, will now report directly to Nicolas Moreau as a member of his Management Committee. She was appointed Global CIO in 2019 and has been with HSBC Asset Management since 2005, with responsibilities including CEO Multi-Manager and CEO Asia Pacific. She will continue to be based in London.
As CEO HSBC Alternatives, she will be responsible for enhancing and expanding the range of alternative investments available to the firm’s wealth and institutional clients, across indirect and direct alternatives including hedge funds, private markets and real estate. Under her leadership, the newly combined team will work closely with other parts of HSBC Asset Management to deliver on the firm’s strategic enablers of client centricity, investment excellence and sustainable investing.
“We have been very successful in delivering innovative capabilities to our institutional and wealth clients, with the recent success of our Infrastructure Debt teams, the rapid growth of our indirect private equity business, the launch of a direct lending investment capability with HSBC UK and the establishment of our Climatech venture capital team. With Joanna’s strong track record of building and transforming businesses, I am confident that we will take our alternatives business to the next leveland accelerate this important growth opportunity“, commented Moreau.
Meanwhile, Munro claimed to be looking forward to leading the growth of HSBC Alternatives and bringing the benefits of alternatives asset classes to new and existing clients. “Alongside sustainable and impact strategies, such as Climatech, we will also look to grow our capabilities in Asia“, she added.
A new Global CIO
After this change, Xavier Baraton, currently Global CIO for Fixed Income, Private Debt & Alternatives, will succeed Munro as Global CIO. Reporting to Moreau, he will join the Management Committee and continue to be based in Paris. He moves into the role with close to 20 years’ experience in investment management. He joined HSBC Asset Management as Global Head of Credit Research in 2002 and has been CIO for Fixed Income since June 2010.
“I am delighted to be appointing Xavier Baraton as Global CIO. Xavier’s outstanding investment track record, commitment to embedding sustainability across our fixed income asset class with innovations such as our real economy EM green bond strategy, REGIO, and more recently his leadership on diversity and inclusion across our investment platform make him ideally placed to lead our investment teams globally”, said Moreau.
The asset manager has revealed that Baraton’s successor will be announced “in due course”.
In 2020, HSBC Asset Management set out its strategy to re-position the business as a core solutions and specialist emerging markets, Asia and alternatives focused asset manager, with client centricity, investment excellence and sustainable investing as key enablers.
