Private markets and alternative assets

Novel takes on asset classes of growing interest

Allocators are looking toward private markets and alternative asset classes to protect their portfolios without putting growth at risk within a volatile environment. Here are some of the latest thoughts on infrastructure, private debt, and more.

Infrastructure

Capping Infrastructure Indexes (Wilshire Indexes)

The FT Wilshire GLIO Listed Infrastructure Index Series provides exposure to globally listed companies which own and/or are operators of infrastructure assets.

Pension Scheme Assets: Infrastructure in Focus (Pensions Policy Institute)

For compliance reasons, this paper is only accessible in the United Kingdom

Investment in infrastructure, at least as a specifically identified asset, is a recent trend and has been developing notably over the last 5 years.

Time to Catch Up on Transition Risks Targets (Natixis IM)

For compliance reasons, this paper is NOT accessible in the United States and Canada

Infrastructure and real estate sectors continue to be impacted by climate change. Allocators must begin to take note of this.

Energy: food and fuels

Future-Proofing Our Food Systems (BNP Paribas AM)

Almost a decade on from limiting food waste being designated as one of the UN’s Sustainable Development Goals, scant progress has been achieved.

Self-Sufficiency in Food Production: An International Comparison (Savills)

There is a huge gulf between the self-sufficiency of different countries. Trade is key to balancing out these inequalities and redistributing where there is excess.

Biofuels: Turning Food into Fuel (Bank of America Institute)

While all gasoline and diesel are made with crude oil, a peculiar aspect of biofuels is that the input used in their production varies significantly.

Private equity and private credit

The PE Return Premium: It's Not Just Due to Illiquidity (Verus Investments)

Private equity should be thought of as an active management allocation with uncommonly high dispersion of active returns.

Private Debt: Few Facts Behind the Fears (Neuberger Berman)

For compliance reasons, this paper is only accessible in certain geographies

The market for private debt gained momentum in the wake of the 2008 Great Financial Crisis as regulatory pressures forced banks to tighten their lending criteria.

How Secondaries Defy the Efficient Frontier (Seine Capital)

A skeptic would question whether the discounts achieved by secondary firms imply an increased risk in the underlying assets or compromised asset quality.

Hedge funds

Overseas Experience and Fund Performance: Evidence from Chinese Hedge Funds

This paper looks at whether foreign education and work experience of an investment manager are important components of the skills that affect performance.

Dissecting Hedge Funds' Strategies

Studies on hedge funds are scarce in comparison to other areas of the finance literature. One reason is that this industry discloses the least amount of information possible.

When Is A Pension Like A Hedge Fund? (CAIA blog)

For financial markets, nothing is as violent as the mixture of leverage and illiquidity. Usually this plays out in hedge funds.