Content (30)

  • Positive Stock-Bond Correlation

    White papers

    Positive Stock-Bond Correlation: Prospects & Portfolio Construction Implications (April 2024)


    As part of PGIM IAS’s ongoing research on strategic portfolio construction, we have explored the macro drivers, global linkages, and portfolio construction implications of stock-bond correlation in a series of papers dating back to 2021. 

  • Great Expectations- Is engagement living up to its promise?

    White papers

    Great Expectations: Is engagement living up to its promise?


    Is ‘engagement washing’ poised to be the next term maligning asset management’s ESG movement? Institutional investors often engage with companies they invest in to improve those companies’ environmental, social and governance practices – rivalling capital allocation as a core mechanism for achieving sustainable investment outcomes. But do engagement activities really deliver impactful, positive, real-world outcomes?

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    White papers

    Credit Squeeze: from Distress and Dislocations to Steep Discounts


    As credit conditions tighten, opportunities are emerging for smart investors. With banks cutting back on lending, pricing dislocations are appearing in financial markets. This looks like a repeat of previous economic cycles, when investors with patient capital have benefited from uncertainty.

  • Food for Thought- Investment Opportunities Across a Changing Food System

    White papers

    Food for Thought: Investment Opportunities Across a Changing Food System


    From farm to fork, our global food system is vast, complex, inefficient and increasingly unfit for purpose. But with the global food system representing just 10% of global GDP, why should institutional investors care? 

  • What to Expect When Expecting A Recession- A CIO’s Guide to Interpreting the Probability of Recession (PGIM IAS, June 2023)

    White papers

    What to Expect When Expecting A Recession: A CIO’s Guide to Interpreting the Probability of Recession (PGIM IAS, June 2023)


    Recessions are a regularity of the economic landscape.  While each recession has its own unique set of characteristics, recessions share common attributes with implications for portfolio construction and asset allocation decisions.  

  • Is there a need for a chief liquidity officer>

    White papers

    Is There A Need For A Chief Liquidity Officer?


    Many institutional investors have a Chief Risk Officer assisting the CIO to measure and monitor portfolio volatility. However, for many long-term investors (e.g., pensions, sovereign wealth funds and defined contribution plans) volatility comes and goes and volatility risk is rarely life-threatening. In contrast, liquidity events can create a sudden and unexpected need to raise cash and can threaten a fund’s survival.

  • Private vs. Public Investment Strategies – Reported and Real-World Performance

    White papers

    Private vs. Public Investment Strategies – Reported and Real-World Performance


    Based on reported cumulative returns, private assets – especially buyout funds – outperformed public assets by a wide margin from 2005 to 2021. However, this traditional performance comparison is misleading because reported performance of private assets does not reflect the real-world performance experienced by CIOs.

  • Portfolio Implications of a Positive Stock-Bond Correlation World

    White papers

    Portfolio Implications of a Positive Stock-Bond Correlation World


    US stock-bond correlation has been negative for much of the past 20y. However, regime change – related in part to fiscal and monetary policies and the broader macroeconomic landscape – can occur, with implications for portfolio performance and construction.

  • Building Portfolios with Infrastructure- Performance, Cash Flows & Portfolio Allocation

    White papers

    Building Portfolios with Infrastructure: Performance, Cash Flows & Portfolio Allocation


    Institutional portfolios have been increasing allocations to unlisted infrastructure investments. However, to fully understand how infrastructure investments can benefit their portfolios, CIOs need better information on the performance and  cash flow characteristics of this asset class, as well as a multi-asset, multi-period portfolio construction framework that is fit-for-purpose when allocating to illiquid, private investments alongside liquid, public investments.

  • IAS-Measuring-the-Value-of-a-Portfolio-Liquidity-Line

    White papers

    Measuring the Value of a Portfolio Liquidity Line


    Cash is needed to provide portfolio liquidity, but it often carries a high opportunity cost. While CIOs may contemplate reallocating a portion of portfolio cash into investment assets to help improve expected portfolio returns, they know that having cash on hand is beneficial to cover unexpected liquidity needs and avoid having to sell assets, especially during poor market environments. But is there a better way to balance the costs and benefits of cash?

  • Webinar Replay- Stock-Bond Correlation- A Global Perspective


    Webinar Replay: Stock-Bond Correlation: A Global Perspective


    For most of their careers, asset allocators have invested in a negative stock-bond correlation world. When stocks fall, sovereign bonds rising generally rise in value – providing a hedge against equities within a diversified portfolio.

  • Screenshot 2022-07-15 at 10.23.59

    White papers

    Stock-Bond Correlation: A Global Perspective


    The correlation between stock and bond returns has been reliably and persistently negative for the last two decades across Developed Markets (DM) – matching the US experience. During this regime, stocks and bonds have hedged one another, dampening overall portfolio risk for a given level of equity allocation.