Connect with us

3 Ways Asset Owners Are Preparing for Slower Global Growth in Fixed Income

Published

on

GIC_capital_tower_2

Last week, the Organization for Economic Co-operation and Development (OECD) lowered its estimate on worldwide gross domestic product for a second time in three months. OECD forecasted the global economy would grow by 2.9% versus 3% this year – and a lower 3.3% in 2016 from 3.6%. A major reason for the revised projection is the deceleration of China’s economic engine and its impact on emerging markets. In the OECD’s latest Economic Outlook No. 98, “China’s transition from infrastructure investment and manufacturing and towards consumption and services is one important reason for the decline in commodity prices, and may be reducing its role in global value chains as well.”

Some sovereign funds are attracted to U.S. credit spreads given low-expected returns estimated for traditional bond investments. In addition, many pension economists predict a slurry of U.S. corporate bond defaults. On November 13th, Fitch Ratings released the energy trailing 12-month default rate for October. It was at 5.3%, the highest point since a peak of 9.7% back in 1999.

The large in-house asset owners like OMERS and the Abu Dhabi Investment Authority (ADIA) have extensive capabilities with their fixed income teams.

#1. Continued Thirst for Yield

[ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

FIRRMA Bill is a Big Deal for Foreign Asset Owners

Published

on

The United States Treasury is analyzing options on further restricting investments into “sensitive” sectors, such as technology and defense, in the United States from Chinese state-owned capital. The U.S. Commerce Department, under the export control regime, banned U.S. companies from selling parts to ZTE Corporation, a Chinese telecommunications manufacturer, for seven years. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

Continue Reading

AIMCo Posts 10.4% Return in 2017

Published

on

The Alberta Investment Management Corporation (AIMCo) posted its performance for the 12-month period trailing December 31, 2017, which saw its overall assets grow by 8.4% – or C$ 8.0 billion (US$ 6.1 billion) – to C$ 103.7 billion (US$ 82.3 billion). This represents returns net-of-fees on its C$ 88.2 billion (US$ 70.3 billion) worth of balanced fund investments in 2017 of 10.4%, against a 9.1% custom benchmark. Established in 2008, AIMCo represents the financial well-being of 32 pension, endowment, government, and specialty funds in the Canadian province of Alberta. This includes the Albert Heritage Fund.

[ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

Continue Reading

Mubadala Real Estate Targets JV Developers, Eyeing Local REIT Launch

Published

on

Mubadala Investment Company’s property arm is preparing to launch a local real estate investment trust (REIT) by 2020, and is currently in talks with several developers for international joint ventures on a plot-by-plot basis that are expected to be finalized in 2018, according to Ali Eid Al Mheiri, executive director of Mubadala Real Estate and Infrastructure. Ali Eid Al Mheiri is also Vice Chairman of ALDAR Properties PJSC and Chairman of Abu Dhabi Finance Company PJSC. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

Continue Reading

Popular

© 2008-2018 Sovereign Wealth Fund Institute. All Rights Reserved. Sovereign Wealth Fund Institute ® and SWFI® are registered trademarks of the Sovereign Wealth Fund Institute. Other third-party content, logos and trademarks are owned by their perspective entities and used for informational purposes only. No affiliation or endorsement, express or implied, is provided by their use. All material subject to strictly enforced copyright laws. Registration on or use of this site constitutes acceptance of our terms of use agreement which includes our privacy policy. Sovereign Wealth Fund Institute (SWFI) is a global organization designed to study sovereign wealth funds, pensions, endowments, superannuation funds, family offices, central banks and other long-term institutional investors in the areas of investing, asset allocation, risk, governance, economics, policy, trade and other relevant issues. SWFI facilitates sovereign fund, pension, endowment, superannuation fund and central bank events around the world. SWFI is a minority-owned organization.