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Investment Insights

The Case for Global Real Assets

PERSPECTIVE FROM FRANKLIN REAL ASSET ADVISORS

Date: September 2017

Global Real Assets provide attractive characteristics for investors wanting to add income, diversification and inflation protection to traditional portfolios. Real assets, which are available to investors through both publicly listed and privately held investment markets, can include real estate, infrastructure, agriculture, timberland and water.

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Topic Papers

DateTitleFormat
October 2017

Hedge Fund Strategy Outlook – Forth Quarter

K2 Advisors seeks to add value through active portfolio management, tactical allocation and diversification across four main hedge strategies: long short equity, relative value, global macro and event driven. In their forth-quarter (Q4) 2017 outlook, the portfolio managers at K2 Advisors share their sentiment for specific hedge strategies in the months ahead.
Summary
October 2017

Notes on Global Equity Markets

Global and international equity markets advanced in the third quarter, continuing the strong rally seen across markets this year, as global economic growth, rising corporate profits and still-easy financial conditions offset rising geopolitical tensions, signs of US government discord and weather disasters.
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October 2017

Insurance Linked Securities Come to the Fore

In August and September, we witnessed a number of catastrophic events. With the recent hurricanes Harvey, Irma and Maria ravaging Texas, Florida and Puerto Rico, along with the earthquakes in Mexico, this has been a tragic humanitarian crisis. These events, while devastating, act as catalysts for insurance-linked securities (ILS). The potential losses from these recent events could set a record for the industry. These losses will cause premiums to rise and yields to increase as policies are rewritten on January 1, 2018.
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October 2017

Emerging Markets Insights: A Stellar Rally Driven by Corporate Earnings and Currency Strength

Corporate earnings for emerging-market (EM) companies have been showing strong and synchronized growth, driving compelling fundamentals for EM equities. We view China’s automobile market favorably. India’s economic growth remains strong in a global context, despite a slight deceleration in the second quarter of 2017.
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October 2017

Global Listed Real Estate: A Key Building Block in a Diversified Portfolio

Building a well-diversified investment portfolio, we believe, should include real estate securities. Although global real estate as an asset class has lagged the torrid advance in global equities in recent quarters, real estate securities continue to provide natural diversification and performance benefits in an investment portfolio.
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September 2017

The Case for Global Real Assets

Global Real Assets provide attractive characteristics for investors wanting to add income, diversification and inflation protection to traditional portfolios. Real assets, which are available to investors through both publicly listed and privately held investment markets, can include real estate, infrastructure, agriculture, timberland and water.
PDF
July 2017

Notes on Global Equity Markets

Perspective from the Templeton Global Equity Group: Global equities advanced solidly during the second quarter, capping a strong first half of 2017 and a similarly strong trailing one-year period.
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June 2017

Alternative intelligence for today’s investor

We believe our clients face a complex investing landscape that demands an intelligent approach beyond traditional asset allocation. Whether they are seeking to improve riskadjusted returns, increase diversification, or better insulate their portfolios from market volatility, an alternative intelligence is required to meet an increasing demand for better investment outcomes.
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June 2017

Hedge Fund Strategy Outlook – Third Quarter

K2 Advisors seeks to add value through active portfolio management, tactical allocation and diversification across four main hedge strategies: long short equity, relative value, global macro and event driven. In their third-quarter (Q3) 2017 outlook, K2 Advisors’ Research and Portfolio Construction teams share the key market events they have an eye on, along with the select strategies that represent their “top convictions.”
Summary
June 2017

Notes on Global Fixed Income Investing

The US is poised for continued expansion, with no immediate recession risks. We expect US inflation pressures to increase on labor market strength and believe the Federal Reserve needs to continue hiking rates. Additional notes include Asia, the Eurozone, India and Latin America.
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June 2017

Value Harvest Sows Seeds for Opportunities Outside the United States

While the value resurgence represents a strong tailwind for non-US equities, there are also a number of fundamental pillars of support—valuations, performance and a variety of economic and other catalysts—for the non-US investment case.
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April 2017

Liquid Alternatives: Dispelling the Myths

In our view, alternative mutual funds, also called “liquid alternatives,” offer a compelling historical risk/return profile with the potential to help reduce anxiety-inducing volatility and to provide a return stream that exhibits low correlations to traditional asset classes. Such characteristics may be useful adjuncts to a typical stock and bond portfolio.
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March 2017

Hedge Fund Strategy Outlook – Second Quarter

The gap between political expectation and political reality has narrowed a bit in recent weeks, at least as it pertains to the 45th President of the United States. The failure to pass the healthcare bill delivered a sobering jab to the post-election giddiness intoxicating Wall Street.
Summary
February 2017

Opportunities in Emerging-Market Local Currency Bonds

Emerging-market local currency bonds have the potential to help improve diversification, hedge inflation, and reduce external debt vulnerabilities within a portfolio.
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January 2017

Global Macro Shifts: Latin America – The Rise and Fall of Populism

This issue of Global Macro Shifts believes Latin America’s experience with populism has important lessons and warnings for the developed world at a time when orthodox economic policymaking appears to be at risk of falling out of favor.
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January 2017

Hedge Fund Strategy Outlook – First Quarter

The Research and Portfolio Construction teams at K2 Advisors explain how higher dispersion following the US presidential election has created reasons for optimism in hedge strategies.
Summary
January 2017

Navigating the Space between “Direct” and “Indirect” Real Estate Investing

Benefits potentially available through a new and developing universe of local partners, who offer a range of investment opportunities on the continuum between “direct” and “indirect.”
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November 2016

Rising LIBOR: The Effect on Bank Loans

While income levels for bank loan investors stand to benefit from the increase in LIBOR, investors should be mindful of the recent strong run-up in asset prices.
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November 2016

Hedge Fund Strategy Outlook – Fourth Quarter 2016

This quarter, the Research and Portfolio Construction teams identify their top convictions for the remainder of the year and discuss how favorable dispersion presents opportunity for hedge strategies.
Summary

 

Archive

DateTitleFormat
September 2016

Relieving Financial Stress Before Retirement

What is driving anxiety in the years before actual retirement and how can we take advantage of cognitive bias to reframe the question in a new way?
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August 2016

An Overlooked Opportunity — Why Global Mid-Caps Make Sense Now and for the Longer Term

Why global mid-caps and some large-caps, particularly those high quality sustainable growth names, could create opportunities in a still sluggish economic recovery.
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August 2016

Retirement Security 10 Years After the PPA, a PlanSponsor Article Reprint

The Pension Protection Act was never intended to solve the whole retirement conundrum, but has served as a vital foundation to expand retirement security to more Americans. What can plan sponsors do under current legislation and regulations to improve retirement security?
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July 2016

Why It Is Time to Consider Global Real Estate Securities

An allocation to global listed real estate has been shown to provide attractive historical performance and diversification potential when included alongside global equities and fixed income and attractive yields in the current low interest-rate environment.
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July 2016

Hedge Fund Strategy Outlook – Third Quarter 2016

Our quarterly outlook containing K2 Advisors’ strongest conviction views, proprietary scoring and commentary across various hedge fund strategies. K2 Advisors Research and Portfolio Construction teams continue to have high conviction for Long Short Equity and Merger Arbitrage strategies. Within the Global Macro strategy, the teams have elevated Emerging Markets into their top three convictions for the quarter ahead.
Summary
June 2016

The State of the DC Industry, 10 Years Post-PPA

This year marks the 10-year anniversary of the landmark Pension Protection Act, and there is plenty to celebrate. How can we continue to help improve retirement outcomes for plan participants?
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June 2016

Global Macro Shifts: Emerging Markets: Mapping the Opportunities

This issue of Global Macro Shifts argues that the key to successful investment in emerging markets lies in distinguishing the more resilient markets from the more vulnerable ones.
Summary
June 2016

The Importance of Tactical Asset Allocation in Target-Date Funds: Countering Market Volatility and Economic Uncertainty

Given today’s unprecedented, pivotal macroeconomic environment, the role of tactical asset allocation (TAA) has never been more crucial. Read how TAA can play a critical role amid growing uncertainty and volatility.
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April 2016

Value Unbound: The Implications of a Nascent Value Revival

The Templeton Global Equity Group explains why the relative outperformance of global value stocks compared to growth stocks in the early months of 2016 may be an early sign of a long-awaited value recovery.
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March 2016

Private Real Estate Co-Investing Today: Opportunities and Challenges

An overview of the benefits of including co-investments/joint ventures alongside primary fund investments.
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February 2016

Looking Internationally to Strengthen Canadian Pensions

Canadians are not saving enough for retirement, and uncoordinated levels of government do not appear to be in a position to enact constructive solutions. Might a possible answer lie in instituting mandatory DC private workplace pension programs?
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January 2016

Can Alternatives be Appropriate for DC Pension Plans?

We discuss the possibilities for increasing use of daily liquid hedge strategies in DC pension plans.
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January 2016

What’s Next for Canadian Pensions?

What can we learn from other markets around the world and what implications does the shifting landscape have for Canada?
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January 2016

2016 Investment Outlook

High-level market insights for the coming year, featuring senior leaders from three key areas central to many investors' portfolio decisions: global macro, global equity and long-term capital markets.
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January 2016

Systematic Beta: A Tool for Next-Generation Investing

An overview of systematic beta, its applications, and its potential benefits when incorporated into a multi-asset investment process.
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November 2015

Real Assets, Real Value

We believe the addition of real asset securities to a portfolio with substantial allocations to fixed income or US equities can provide a number of important benefits for insurance companies.
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October 2015

Employees Approaching Retirement Defy Conventional Wisdom on Plan Engagement: Original DC Plan Participant Research

Contrary to the common belief that plan participants are generally unable or unwilling to prepare for their own retirement, we found that participants approaching retirement show higher levels of engagement in their DC plans and a greater willingness to explore new solutions than the general plan participant population.
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September 2015

Is Value Set to Soar?

Why does the Templeton Global Equity Group believe the potential recovery in value investing could be profound and represents the most attractive contrarian investment opportunity in equities today?
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September 2015

Finding Diamonds in the Rough: Emerging Real Estate Managers Provide Unique Investment Exposures

We believe commercial real estate continues to be an attractive asset class for institutional investors looking for diversification, historically attractive returns and potential income generation.
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September 2015

Rising Rates and the Case for Leveraged Loans

The Franklin Floating Rate Debt Group looks at the implications of a changing-rate environment for investors in bank loans, at the current market composition and how to position portfolios in this environment.
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July 2015

Glide Path Optimization Avoids Slippery Slope of Extended Equity Risk

How much equity risk is appropriate in the final years leading to retirement? Why do “to” glide path solutions offer a better outcome?
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June 2015

Finding New Ways to Access Alternatives, A Pensions & Investments Article Reprint

A discussion on the packaging of daily priced hedge strategies in easy to access structures, making alternatives available at more comfortable fee levels.
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May 2015

Liquid Alternatives: Dispelling the Myths

Do common concerns over liquid alternatives, including compromised return potential and lower manager quality have merit?
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April 2015

Concentrated Yet Diversified: A Distinctive Approach to Global Investing

Can concentrated global equity portfolios be truly well diversified?
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April 2015

Global Bonds: Actively Positioned for Rising U.S. Interest Rates

How has Templeton Global Macro actively positioned their portfolios to gain from rising U.S. Treasury yields as well as hedge against global risks in developed and emerging bond markets?
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March 2015

Optimizing Plan Design in Defined Contribution

Important considerations for designing a DC pension plan at both the benefit and investment level.
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March 2015

Caution: The Barclays U.S. Aggregate Index May Be Riskier Than Most Followers Think

Index investors may be inadvertently exposed to additional risks; an active management approach to improving fixed income diversification can help account for multiple risk factors.
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January 2015

David Saunders and the Beyond-Bespoke Portfolio, an Institutional Investor’s Alpha Article Reprint

The CEO of K2 Advisors says diversifying strategies isn’t enough, so he invests data point by data point.
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January 2015

No Free Lunch: Active Opportunities in a Passive Market

Debunking some of the myths surrounding the active vs. passive debate.
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January 2015

Reforming Canada’s Pension System for Sustainability

Critical modernization is required to bring Canada’s pension system into the 21st century.
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