THIS TIME IS DIFFERENT – NAVIGATING GLOBAL GEOPOLITICS
The volume of geopolitical coverage and analysis has risen exponentially in recent years, with issues such as the trade war between the US and China, Brexit, and conflict in the Middle East all dominating mainstream news headlines.
In such a climate, is there room for a contrarian or left of centre view? What are investors potentially missing that has the potential to disrupt markets? Our opening speaker will look across the landscape of global geopolitics in 2020, providing an alternative perspective on developments set to play out over the next decade.
THE EMERGING MARKETS
EXPERIEMENT IS OVER
It has become widely appreciated that emerging markets will be a key driver of global growth over the next decade. However, this potential has not translated into profits, with the MSCI Emerging Markets Index delivering a lackluster 3.8% annualised return over the 10-year period to October 31, 2019.
Are the tables set to turn? Should investors carry a much more meaningful allocation to emerging markets? Or should the experiment of modern emerging market investing, which brings together markets as diverse as China, Russia, South Africa (and most recently, Kuwait), come to an end?
Speakers in this session will debate this contention, delving into the key factors that will drive performance in both regions, the case for and against investing in emerging markets, and how they would set their international equities asset allocation.
QIAO MA, Portfolio Manager – Asian Equities, Cooper Investors
MATT REYNOLDS, Investment Director, Capital Group
BRINGING VINTAGE VALUE BACK IN STYLE
Value investing has underperformed for a decade (an eternity for financial markets!), with value funds only managing to outpace growth twice over the last 10 years. Indeed, value managers haven’t faced this level of pressure since 1999 and 2000. In that instance, those that persisted benefited from a huge performance reversal brought on by the bursting of the dotcom bubble. During the current cycle, every year we have heard of value’s ‘comeback’ – will 2020 mark the much waited for turnaround? Or are there structural reasons behind value’s decline?
JOHN HOCK, Founder & Chief Investment Officer, Altrinsic Global Advisers
THE ROAD TO HELL... IS PAVED WITH HIGH YIELD
Valuations are high, interest rates are low, but investors still expect growth and income. The pious will call for reducing return expectations, which will close part of the gap, but can our clients survive on these lower yields?
As advisers, we have been pitched a broad array of solutions, but all likely involve taking on some form of additional risk. Perhaps the road to capital destruction is paved with chasing returns?
Should we simply stay the course and stick broadly with balanced portfolios, or is the 60/40 portfolio ‘doomed’ as some now suggest? Speakers in this session will share their perspectives on how we should achieve a balance between lower return expectations and extracting higher yields.
ANDREW CANOBI, Director, Australian Fixed Income, Franklin Templeton Fixed Income Group
WILL BAYLIS, Portfolio Manager, Martin Currie – a Legg Mason affiliate
NELSON YUAN, Alternative Strategist, PIMCO
THE QUESTIONS MOST FUND MANAGERS HATE TO GET ASKED
We know that most equity managers underperform over time. We also know that identifying the few that are likely to outperform prospectively is hard. Many of last year’s winners just got lucky. How are advisers to separate the thoroughbreds from the donkeys? In investment management a good outcome can come from bad process and vice versa – but not forever. How can advisers look beyond the simple performance numbers to identify a quality, repeatable process? We introduce the two metrics that we believe best measure active equity investment management skill. To separate real process from accidental heroes, ask fund managers how they performed on these two simple measures.
STEPHEN ARNOLD, Managing Director & CIO, Aoris Investment Management
IS AUSTRALIA ENTERING A LOST DECADE?
At first glance, Australia is the goldilocks economy. It continues to enjoy the world’s longest economic expansion, is blessed with abundant resources, stable democratic government and institutions, and positive demographics underpinned by immigration.
And yet, there are serious causes for concern. Our resources boom depends on China, whose growth rate has already slowed significantly. Our once dominant banking sector has been seriously impaired by low interest rates and the royal commission. And we are on the precipice of our own version of quantitative easing, with the economy seemingly unable to kick into a higher rate of growth.
Is it time to end our home-country bias? Or can our local market continue to deliver attractive returns? Speakers in this session will weigh the arguments for and against investing in Australia.
PHILIPP HOFFLIN, Portfolio Manager/Analyst, Lazard Asset Management