The search for new yield-oriented investment opportunities has been a notable characteristic of the post-global financial crisis landscape. However, in the sea of alternative investing, the island left largely unexplored remains the maritime industry.
From the Current Issue
We all need to eat, and we all need to stay clothed. To the uninitiated, retail real estate seems like an easy defensive play, relatively resistant in any downturn. It is anything but, however, and the Great Recession has laid bare the shortcomings of any managers who thought they could simply buy and hold.
Summer is here, and many of your clients probably require less attention now that their thoughts have turned to vacation, and away from the vagaries of the market.
That makes the quieter summer season an ideal time to step back and do some planning when it comes to your own practice. After all, many advisers rarely take the time to focus on their practices because they are too busy tending to their clients’ affairs, particularly during tax season and the hectic year-end period.
Any rich person’s investment portfolio is sufficiently well oiled to have capitalized lavishly on the robust U.S. energy sector. I’m talking about fossil fuels and the way the hydraulic fracturing (or “fracking”) revolution has catapulted the United States from a vulnerable energy-dependent state into the world’s number one producer of oil (having surpassed Saudi Arabia) and natural gas (having more recently surpassed Russia) to assume those dual crowns.
Jigar Shah leaves his audience gasping.
“If the storage industry is dependent on backing up solar, it’s hopeless. You should quit your job today,” Shah, a co-partner in Generate Capital, a San Francisco–based renewables financing firm, tells them.
There are many more ways for companies in the storage world to revolutionize the grid, he says.
Water infrastructure in the United States needs an upgrade. The question is how will the needed projects be delivered.
Industry players say water infrastructure projects in the United States are ripe for the P3 model because of a highly fragmented market, tight municipal budgets, and the recognition that building and operating increasingly complex water projects is not an expertise of local governments.
Welcome to the Everything Boom — and, quite possibly, the Everything Bubble. Around the world, nearly every asset class is expensive by historical standards. Stocks and bonds; emerging markets and developed economies; urban office towers and American farmland; high-end housing; you name it, and it is trading at prices that are high by historical standards relative to fundamentals.
For more than 20 years, institutional investors have recognized commercial real estate as an essential asset class, often deserving of its own portfolio allocation of 8 percent to 10 percent or more. In fact, the investable universe of U.S. commercial real estate is estimated at nearly $13 trillion today, weighing in at just under half the U.S. public equities market cap of $27 trillion and approximately one-third the $38 trillion fixed-income market. Despite the compelling data in support of the “case for real estate,” private clients and smaller institutions have significantly lagged larger institutional investors’ allocations to real estate, often times limiting their investment choices to the classic 50/40/10 stocks/bonds/cash portfolio model.
Two regional trade pacts, namely the Trans-Pacific Partnership (TPP) and the Trans-Atlantic Trade and Investment Partnership (TTIP), have gathered momentum recently, with TPP poised to begin its final negotiation stretch in 2015. This is likely to turn the heat on Congress to take action with ratification, making export-focused agriculture a clear winner in that scenario.
The U.S. housing market is in a significant upswing, and that is enriching the fortunes of those invested in the industrial property sector as warehouses stock-up on all the things that make a house a home.
Hotels are nudging their way into the mainstream, with generous year-on-year increases in investment volume. A shortage of quality opportunities across traditional commercial real estate has generated interest, but investors are also seeing the substantial returns that can be made in the sector on the back of positive economic trends. The low price of oil is among these, and hotels are one of the few sectors inherently well positioned to reap the benefits.
Financial planning is in the midst of an evolutionary stage, driven by financial advisers’ efforts to better define their value propositions and secure long-term client relationships. As competition continues to increase, the quality of the client experience and depth of the client relationship become an adviser’s true differentiators.
One gets the notion after a chat with money manager Gregg Fisher that when he reports to his New York City office each morning, he hangs his Emotional Self right next to his suit coat. And he does not re-clothe himself in emotion until his fiduciary responsibility to clients has been completed for the day.
We are halfway through 2015 and investors are beginning to take stock of how their investments are doing. For nearly all real asset categories, the first half of the year has been pretty stable, maybe even boring. In general, it has been a slower, less extreme version of the last six months of 2014. If the sector was doing well in 2014, it is still doing well, but not quite as well. If returns were falling in 2014, they are still falling, just not as fast.