Publications

- April 1, 2021: Vol. 14, Number 4

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By the benchmark: How investors can best use benchmarks to invest in infrastructure assets

by Alex Frew McMillan

Infrastructure, as a relatively new and unfamiliar asset class, lacks the benchmarks and indexes of established real estate sectors. That’s beginning to change, with cross-sector comparisons gradually being created and improved. How can investors best use benchmarks to invest in infrastructure assets?

Infrastructure investment is the favorite asset class for investors heading through 2021. Chastened by the horrible events of 2020, and the flow of red ink that a woeful disease has left in the wake of its terrible human toll, many portfolio managers are attracted to the steady nature of infrastructure projects and companies.

Is their faith in the asset class rewarded, however? And how can you tell?

The huge scope of “infrastructure” leaves some asset managers wondering if performance can be compared meaningfully across the asset class. The disparate nature of the holdings — electric utilities, road operators, airports, new energy, telecommunications and IT

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