The evidence for infrastructure’s inflation hedge characteristics is strong. Historical data show that infrastructure has performed better than listed equities and bonds when inflation is high, when it is rising, and when it surprises on the upside.
Infrastructure debt and private placements offer a number of potential benefits to insurance investors—from a potential spread premium to diversification and strong covenants.
In the past four plus years, relative value has diminished across investment-grade fixed-income sectors. However, Conning notes that segments of the broader $4 trillion municipal bond market offer insurers opportunities not only for diversification but to also to enhance portfolio yield and improve aggregate credit quality.
From the explosive growth in private markets to the integration of ESG best practices, the alternatives landscape is rapidly evolving. To help investors adapt, we propose five areas of focus, including thoughts on manager selection, late-stage venture capital, and thematic investing, among other topics.
The 26th annual edition explores how the legacy of the pandemic – limited economic scarring but enduring policy choices – will affect the next cycle. Despite low return expectations in public markets, we think investors can find ample risk premia to harvest if they are prepared to look beyond traditional asset classes.
Insurers embrace risk. s many economies make a strong restart following mass vaccinations and unparalleled financial stimulus from central banks, 362 senior insurance executives across the globe have shared with BlackRock their experiences and perspectives on the global insurance industry. Our interactive report charts key themes and global and regional implications.
Essentially, these new factors in almost all cases are more punitive to health and P&C insurers than are the existing factors. In the following, we show a comparison of the current factors and the new factors, and provide some brief comments about how this will change the investment allocations for these insurers going forward.
Conning believes alts may offer insurers a greater menu of investment choices to help further diversify a portfolio, generate greater yield and return, and improve downside protection. We also think that, as with any investment selection, an alt must align with an insurer’s investment strategy.
When allocations to private markets were smaller, building portfolios using rules of thumb and traditional optimization techniques was acceptable, if not ideal. Today, larger and more diverse allocations require an approach that can meet the private market challenges of illiquidity, extreme dispersion of returns, scarce data and barriers to maintaining allocations at desired levels. We have developed a framework that addresses these complexities.
As interest grows in environmental, social and governance (ESG) topics across industries and stakeholders, insurers are recognizing the need to report on progress against ESG benchmarks. This paper examines the state of ESG for insurers and the progress in establishing measurable goals
For insurers interested in casting the net wider in the search for income, delving a little deeper into non-established parts of Structured Finance or down in the stack of established segments might have the potential to provide increased income.
Goldman Sachs Insurance Asset Management released the findings of its tenth annual global insurance report, “Running the Risks,” revealing improving economic conditions amid considerable uncertainty.
Our team is tactically positioned for a cyclical recovery in EM credit; however, we also feel strongly about strategic EM fixed-income opportunities that may be appropriate for our insurance clients and prospects. The type of EM allocation we are talking about goes beyond the standard ETF or “off-the-shelf” EM fund solution and speaks directly to insurance investors who have a more refined palate with regard to their income, return and capital needs.