Recent thinking
Fixed income
Fed’s policy shift may spell long-term trouble for bonds
23 Sep 2020
Bond markets have taken the recent shift in the Federal Reserve’s policy framework in their stride, partly because interest rates are now expected to stay lower for even longer. But they look vulnerable if the Fed can revive inflation.
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Equities
Investing in the gut: Fixing the bacterial bugs in our microbiome
21 Sep 2020
COVID-19 has intensified interest in the human microbiome, as researchers contemplate whether bacteria living in the gut might affect susceptibility to infection. Drawing on our experience in public markets and Ahren Innovation Capital’s knowledge of private markets, we look at the companies making strides in live biotherapeutics, using ‘bugs as drugs’, and key challenges that need to be overcome.
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Fixed income
Emerging market debt: A path less volatile
17 Sep 2020
After one of the most volatile periods on record, hard currency emerging market debt is once again drawing investor interest, thanks to attractive yields and its diversification potential. But while markets recovered quickly from the volatility, investors should remain cautious for the challenges ahead.
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Equities
Why limit yourself? The benefits of style-agnostic investing
16 Sep 2020
Investors wanting to consistently exploit market inefficiencies should leave style biases behind, argues Mikhail Zverev.
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Real Assets
Fibre broadband: The need for speed
9 Sep 2020
Lockdown measures imposed during the COVID-19 pandemic have highlighted the importance of digital connectivity. Tim Perry looks at the investment opportunities and challenges associated with European economies transitioning from copper to faster fibre broadband networks.
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Equities
Out with the old: Why income investors must be on the right side of change
2 Sep 2020
It has been a difficult year for income investing, as many companies have announced cuts or suspensions to dividends. But there are opportunities for investors willing to do some digging to find resilient businesses, says Richard Saldanha.
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Equities
The clockmaker and the longitude problem: A lesson for investors in bottom-up problem solving
25 Aug 2020
Bottom-up thinking is not a typical hallmark of multi-asset investing. However, Francois de Bruin believes the granularity that comes from this approach offers useful diversification and risk benefits.
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Real Assets
Swipe right: The Tinder effect on real estate
24 Aug 2020
It can be hard to perceive how society, and consequently our use of real estate, is changing. Sometimes, major structural trends are hiding in plain sight, says Chris Urwin.
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Multi-asset & multi-strategy
COVID-19: Can a lasting recovery happen without a vaccine?
21 Aug 2020
With the notable exception of China, countries around the world have struggled to get their economies firing on all cylinders without COVID-19 infections flaring up again. Until a way to contain the virus is found, recoveries are likely to remain stop-start and fragile, argue Ian Pizer, Mark Robertson and Sunil Krishnan.
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Real Assets
Five charts that show Manchester is a city of the future
20 Aug 2020
In this short, visual article we present five charts that show why Manchester is such a rich, vibrant and economically prosperous city. Our view is that the ingredients of connectivity, culture, talent, scale and scientific heritage make the city well-equipped to thrive in the coming years and decades.
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Multi-asset & multi-strategy
COVID-19 and antimicrobial resistance: The next health crisis?
19 Aug 2020
As the world grapples with COVID-19, antibiotics used to treat serious secondary bacterial infections associated with the coronavirus are making their way into wastewater with potentially dire consequences. Abigail Herron questions whether investors appreciate the seriousness of what antimicrobial resistance could lead to.
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Equities
The new rules of client engagement
18 Aug 2020
As the coronavirus pandemic reshapes our working lives, asset managers must find new ways to interact with their clients, says Apiramy Jeyarajah.
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Multi-asset & multi-strategy
Multi-asset allocation views: What we can learn from earnings season
14 Aug 2020
Investors have faced several surprises during Q2 earnings season. Sunil Krishnan discusses what the current results round means for multi-asset investors over the coming months.
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Equities
Electric avenue: EVs and the transformation of autos
13 Aug 2020
In the latest instalment of our editorial series, Link, experts from our infrastructure, credit research and equity teams discuss why efforts to ‘build back better’ as economies recover from COVID-19 could further accelerate investment in electric vehicles and associated infrastructure.
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Equities
Chinese equities: A rally of substance?
12 Aug 2020
Chinese equities have risen sharply in recent weeks, mirroring trends in global markets. While some commentators have warned efforts by Beijing to juice share prices are inflating an unsustainable bubble, Alistair Way and Xiaoyu Liu argue valuations are far from excessive.
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The AIQ Podcast
The AIQ Podcast: Risk and resilience in an age of uncertainty
11 Aug 2020
The latest episode of the AIQ podcast explores the nature of risk in an uncertain world. How can we stay resilient when the unexpected occurs?
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The Little Book of Data
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AIQ Features
Roll of the dice: Risk and resilience in an age of uncertainty
21 Jul 2020
The coronavirus pandemic has highlighted the difficulties of managing risk in an increasingly globalised and interconnected world. We explore how organisations can stay resilient through an era of radical change.
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The evolution of ESG: More than just a risk mitigator
21 Jul 2020
Once dismissed as a virtuous endeavour that compromised investment returns, the ability to gain a more holistic view of risk by considering environmental, social and governance factors is increasingly appreciated by investors. We assess the evolution of ESG across asset classes, as well as its role as a risk mitigator and opportunity spotter.
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The Technocrat: Lord Adair Turner
21 Jul 2020
With developed economies stuck in a high-debt and low interest rate trap, the former head of Britain’s financial watchdog believes central banks should break a long-held taboo and finance governments directly.
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Economics and ethics: Why diversity matters
21 Jul 2020
In business, diversity can be the difference between success and failure. But while progress towards it has been frustratingly slow in many areas, the pressure is mounting on companies to act.
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Pandemic risk: When will we learn our lesson?
21 Jul 2020
COVID-19 has reminded us that the sources of economic and financial crises can be wildly unpredictable. However, while spotting patient zero in advance was nigh on impossible, pandemic risk was well telegraphed. In the first part of our mini-series, The source of the next crisis, we consider whether an infectious disease could wrong-foot us again or whether governments will learn their lesson.
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Cybersecurity in the fourth industrial revolution
21 Jul 2020
COVID-19 shocked investors into taking pandemic risks more seriously. In an increasingly connected world, where data is the new oil, could cyberattacks be the next big threat?
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Inflation hawks: Crying wolf?
21 Jul 2020
Twelve years on from the financial crisis, inflation hawks are back. They were proved wrong then, but could this time be different? In part three of our mini-series on the source of the next crisis, we explore the extent to which inflation poses a risk to the global economy and financial stability.
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Geopolitics: Could the coronavirus pandemic lead to a new Cold War?
21 Jul 2020
The US-China relationship has deteriorated in the midst of the COVID-19 pandemic. What does this geopolitical rivalry mean for the global economy and markets?
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Nature and neglect: The era of ecological disasters
21 Jul 2020
As the frequency and ferocity of natural hazards increase, in part five of our mini-series on the source of the next crisis AIQ considers the economic and investment implications and what we can learn from past mistakes.
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The Economist: John Kay
21 Jul 2020
AIQ speaks to economist and author John Kay about risk, uncertainty and the longer-term implications of the coronavirus pandemic.
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The risks on the savings and retirement journey
21 Jul 2020
COVID-19 has caused significant volatility in financial markets, creating headaches for defined contribution pension schemes seeking to deliver robust outcomes. Overcoming this requires a full map of risks along the savings and retirement journey, argues Francois de Bruin.
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Policy moves into the great unknown, but at what cost?
21 Jul 2020
Policymakers are dreaming up ever more radical experiments to try and pull economies out of what could be the deepest recession in living memory. But until the world can cure its addiction to debt, financial markets will remain on a knife edge.
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Trial and error: The value of learning from mistakes
21 Jul 2020
A common characteristic of successful people and organisations is an ability to recognise and quickly learn from their mistakes. UK Equity Income Fund Manager Chris Murphy shares the lessons he has learned from an eventful career.
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Will COVID-19 concentrate corporate power
21 Jul 2020
The fallout from the coronavirus pandemic could see large firms cement their dominance over weaker rivals. We examine the implications for investors.
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Resilience in credit: All calm for now, but big tests lie in store
17 Jul 2020
For credit investors, resilience is about taking appropriate levels of risk, understanding market dynamics, and identifying companies best prepared for the future. All these qualities could be tested given the wide range of possible outcomes as the world begins to recover from COVID-19.
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Real assets and the quest for resilient income
6 Jul 2020
COVID-19 has made life harder for already yield-starved investors, and each asset class faces its own challenges. We draw on the latest thinking from our Real Assets House View and research team to highlight where reliable income sources can still be found in real asset markets.
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AIQ Client Matters
Five charts that show Manchester is a city of the future
20 Aug 2020
In this short, visual article we present five charts that show why Manchester is such a rich, vibrant and economically prosperous city. Our view is that the ingredients of connectivity, culture, talent, scale and scientific heritage make the city well-equipped to thrive in the coming years and decades.
Read more
The AIQ Podcast: Risk and resilience in an age of uncertainty
11 Aug 2020
The latest episode of the AIQ podcast explores the nature of risk in an uncertain world. How can we stay resilient when the unexpected occurs?
Read more
Education, entrepreneurship and biological age: An interview with Andrew Scott
6 Aug 2020
In part two of our interview with Professor Andrew Scott from London Business School, we look at how policy will shift to take account of people living for longer and how service providers will respond.
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Longevity, policy and technology: An interview with Andrew Scott
6 Aug 2020
Living longer brings enormous opportunities to reshape how we spend our time. But in the first of a two-part interview, Andrew Scott from London Business School explains how advances in longevity and technology have not been matched by innovation in social structures or our approach to financial planning.
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Where can investors put cash to work when rates go negative?
30 Jul 2020
Just when investors thought they couldn’t sink any lower, the economic shock caused by COVID-19 has put further downward pressure on interest rates in developed markets. Caroline Hedges, head of global liquidity portfolio management at Aviva Investors, looks at the impact on money market funds.
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Defined Benefit pensions de-risking: A covenant and investment view
23 Jun 2020
In the midst of the COVID-19 shock, Felix Mantz from Lincoln Pensions and Joachim Sudre from Aviva Investors explore how defined benefit pension schemes should plan their journey towards an end game and adopt a more holistic approach to risk.
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COVID-19: Will credit markets remain open for business?
1 May 2020
While concerns around credit market liquidity have been rising since the global financial crisis, the COVID-19 sell-off has highlighted how fragile liquidity can be during periods of real stress. Colin Purdie discusses the short- and long-term implications for investment grade and high yield credit globally.
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RPI may be flawed, but changes shouldn’t cost pensioners and investors
16 Mar 2020
With the start of the consultation for proposed changes to the measurement of inflation in the UK, we look at the likely impact to asset classes, the assets most affected, and the key issues investors should be aware of.
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Climate risk for insurers
12 Dec 2019
Climate risk has become a critical business issue, but a recent consultation by the European Insurance and Occupational Pensions Authority highlights confusion on how to assess it.
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Five charts that will make you think differently about retirement
23 Aug 2019
Retiring at 60 is a relatively new concept, and possibly a short-lived one in our history. As populations age – and age better – people are looking at a host of ways to stay in work and sustain their retirement income. We present five charts that sum up the changing landscape.
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Self-sufficiency for pension schemes: Keep on running?
28 May 2019
Boris Mikhailov and Matthew Graham look at the benefits and risks for pension schemes targeting self-sufficiency.
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The future of insurance
17 May 2019
The insurance industry has evolved rapidly since the financial crisis. The next decade is shaping up to be every bit as transformative as firms grapple with a host of factors, most notably the unfolding regulatory framework, digital disruption and climate change.
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The future of retirement
28 Feb 2019
The idea that in one’s sixties it might be time to step out of work and retire into a life of leisure is relatively recent. But with more people living longer, expectations of retirement are being reshaped.
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Conference calls: a snapshot of investors’ views on the big issues
23 Oct 2018
Attendees at Aviva Investors’ annual institutional investor conference gave their take on some of the key themes impacting pensions schemes, from ESG to asset allocation shifts.
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Balancing liquidity and flexibility: a DB de-risking dilemma
13 Sep 2018
As transfers out of UK Defined Benefit (DB) pension schemes reach record levels, John Dewey assesses the implications for pension schemes with alternative income allocations.
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The AIQ Podcast: Who wants to live forever?
11 Jun 2018
This latest episode of the AIQ Podcast, we look at the implications of increasing life expectancy for individuals, companies and policymakers. Specifically, we’ll look at what this means for the advisory, pensions and insurance industries.
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House View
A quarterly publication which encapsulates the thinking of our investment team.
Executive Summary
A summary of our outlook for economies and markets.
Key investment themes and risks
The six key themes and risks which our House View team expect to drive financial markets.
Macro forecasts: charts and commentary
Our round-up of major economies; featuring charts and commentary.
Global market outlook and asset allocation
What our House View means for asset allocation and portfolio construction.
Webcast
Keep up-to-date with our latest thoughts on financial markets by joining our interactive sessions.
Macro House View Q2 2020: COVID-19 and the economy – can the engine restart?
Join us for a quick discussion with Stewart Robertson, Senior Economist, and Jerome Nunan, Investment Director, Multi-Asset, as they discuss how COVID-19 and the containment measures implemented by governments around the world to deal with it have impacted our latest House View.