Market disruptions. We’ve seen many of these since the great financial crisis, and they’re usually bad things. The liquidity freeze. The taper tantrum. The oil price drop. In recent years, disruption has taken on new meaning in the tech world. A disruptor has been defined as one of two things: a product that addresses a market that previously couldn’t be served, or one that offers a simpler, cheaper, or more convenient alternative to an existing product.
Heading into 2018, we are seeing disruption of all kinds create opportunities in markets:
• We see global economic growth finally becoming synchronized.
• Companies are starting to invest again, opening the door for disruption to business models and opportunities within multi-asset investing.
• In fixed income markets, we expect a disruption to the recent success of passive strategies that rely on beta returns, which means investors will need to focus on finding sources of alpha.
• In equities, we expect a wave of “smart capex” and strategic investments that will create more winners and losers, which will make security selection more important than ever.
• Within private funds, we are focused on opportunities in the small and midsize markets.