Investors move toward conservatism late in cycle
Although “late-cycle investing” has been widely discussed since 2015, the 2018 calendar year brought a significant shift in new manager selection activity, according to bfinance’s Manager Intelligence and Market Trends February 2019 quarterly analysis report.
Although there is still a considerable amount of yield-hunting under way, the overall tone is one of increased conservatism. Mandates for emerging market equity and debt strategies have declined versus 2017; searches for traditional global equity and aggregate fixed-income strategies increased; risk overlay strategies rose in popularity.
At the subsector level, the report also sees a focus on resilience. In infrastructure and real estate, there has been a modest trend from equity searches toward debt, although both areas rose in terms of mandate number and volume as investors continue to build out real asset portfolios. In “diversifying strategies” bfinance still sees an emphasis on more liquid,