Note: This piece was adapted from a roundtable discussion. -- What do corporate fundamentals look like in a year where inflation and rates are taking center stage? Developed and emerging market (EM) corporates look fairly well-positioned, supported by the continued re-opening of economies and largely successful vaccine rollouts around the world. Earnings have also improved across the board, and defaults are expected to remain low going forward. That said, there are ongoing concerns around inflation amid rising raw material costs and supply-side disruptions. Although many companies have been able to pass higher costs through to consumers, the longer-term casualties from the tangled supply chain will have repercussions for some time to come—and we have likely not yet seen the full effects of wage inflation. These factors raise questions around how much margin compression may result from continued inflationary pressures going forward and the ultimate impact of inflation on consumer demand. On the positive side, for both developed and EM companies, we've seen a significant amount of refinancing in 2020 and 2021, meaning many companies have locked in lower funding costs and now have a stronger buffer against these pressures. This should help keep corporate fundamentals relatively stable.

Equity markets were jolted in January amid growing concerns about macroeconomic threats. For investors seeking more stable equity allocations, stocks “in the middle,” with high-quality features and reasonable valuations, can help portfolios cope with volatility.

It is becoming increasingly apparent that Environmental, Social, and Governance (ESG) considerations are at the forefront of Investors’ minds. ESG and sustainability considerations are becoming a focus throughout all stages of the investment process. Considering the current events and how ESG factors are shaping the ways we live, in October, world leaders met at the United Nations Climate Change Conference in Glasgow, Scotland, to address the issue at hand. Numerous Investment Managers and hundreds of Investors have made the pledge to commit to net zero carbon. CBRE highlighted key trends influencing Investor strategies in 2021 and beyond, many with ESG considerations taking the lead. A recent study by the Harvard Business Review concluded a third of all professionally managed assets, roughly $30 trillion, are now subject to ESG criteria across the globe.[1] While the list of sustainable initiative efforts grows exponentially, Diversity, Equity, and Inclusion (DEI) initiatives are also moving to the fore in our industry.

We would like to thank Sarah Welton, Business Growth Director, at Longevity Partners and Zoe Hughes, Chief Executive Officer of NAREIM for their contributions to this article, given their extensive knowledge and expertise in the ESG space.

In the world of safaris, “the big five” are highly prized among sightseers and photographers: the lion, leopard, black rhinoceros, elephant, and buffalo. But in investing, the big five could more aptly refer to the connected categories of growth, inflation, interest rates, valuations, and style.

True hyperinflation, marked by unfettered price increases and severe currency devaluation generally occurs during times of turmoil or war. This is a rare occurrence in developed countries. Regardless, growing inflation rates are an important dynamic to observe, and investors can smooth the yield curve by employing alternative investment strategies.

As inflation continues to increase, many things from grocery store items to alternative investment portfolio values will be affected. Here’s what you should be mindful of in the months ahead.

The Global Listed Infrastructure (GLI) universe continues to emerge as an investment strategy for investors seeking inflation-sensitive assets with the potential to deliver equity-like returns. Alongside other real assets such as midstream MLPs, Commodities, and REITs, for example, GLI can provide additional diversification to institutional portfolios. With roughly 80 available GLI products in the universe, investors can select from a variety of approaches. The first GLI strategies were incepted in the mid-to-late 2000s and are pre-dated by unlisted infrastructure investment strategies that invested in privately-held companies and assets. Today, investors who seek the benefits of the infrastructure asset class without the liquidity constraints of the unlisted space may find an appropriate solution in GLI.

We have reached a pivotal point in both the economic and monetary policy cycle, and uncertainty for fixed income is high. The key questions on every fixed income investor’s mind are 1) where are rates going, 2) what do returns look like, and 3) what approach is best?

The demand for single-family housing in the U.S. should be exceptionally strong over the next decade due to a combination of demographic forces and lagging underinvestment in residential stock. Hines Research estimates that the market will require 17 million single-family housing starts from 2021–30. This would represent a dramatic escalation of home construction relative to any decade of the past fifty years and a generational opportunity for residential lot development.

Hark! Is that Jolly Old Saint Nick, climbing quickly to altitude in the winter night sky?

The maritime industry is a massive and critical component of the global supply chain, responsible for transporting approximately 90% of global goods and commodities,[1] as well as producing clean electricity and low-carbon food. Due to its size, the industry is responsible for approximately 3% of global CO₂ emissions,[2] as well as other pollutants.

2021 was an impressive year for crypto as the market, led by Bitcoin, expanded to a market cap of roughly $3 trillion, up from $800 billion at the start of the year. Bitcoin itself was able to maintain a market capitalization of over $1 trillion for several months and stands at approximately $1.1 trillion at the time of writing. While its price action throughout the year was well documented by the media, its adoption as an inflation hedge and as a currency were overlooked.

Public defined benefit (DB) plans face intensifying pressure as modest expectations for future investment returns continue to fall short of actuarial discount rates. Post-pandemic market conditions have magnified the challenge as investment consultants continue to lower their capital markets assumptions in the face of low interest rates and rising equity market valuations, which both point to leaner future returns.

More than 40 million people worldwide are estimated to be victims of various forms of modern slavery, including forced labor, debt bondage and human trafficking. Forced labor alone is estimated to generate profits of US$150 billion a year for the criminals behind it.

Sports and healthcare investing may not seem to have much in common—until you consider the role that defense can play in both.

While we believe the pace of economic growth will gradually decelerate over the course of the year, we expect it will remain above-trend. Driving this solid economic activity will be three distinct forces – the consumer, inventories, and business investment.

Each holiday season, the U.S. Census Bureau releases its economic rundown of holiday economic retail figures. As trustees and administrators of public employee retirement systems, keeping up with the financial market is essential. Pension funds in the U.S. hold trillions of dollars in assets and are critical economic institutions in their quests to make up for some of the loss of income for retired state and local government workers such as police and firefighters.