Latest edition of Financial Investigator now online
This preface was originally written in Dutch. This is an English translation.
Diversification is the key word
While financial markets initially reacted euphorically to President Trump's re-election, sentiment took a complete turn after he announced reciprocal import tariffs. Since then, markets have become highly volatile due to the unpredictability of Trump's policies and their impact on the global economy.
The announcements on ‘Liberation Day’ sent shock waves through the financial markets. Consumer and producer confidence, which was already weakening, subsequently fell to a historic low. The chances of recession in the world's major economies are increasing.
In Germany, on the other hand, there was a favourable development for investors: the proposal to invest €500 billion in the economy and relax budget rules. This marks a historic change given the budgetary discipline for which Germany has been so well known in recent decades. Whether these measures can actually prevent a recession remains uncertain for the time being.
Recession threats, market volatility and uncertainty... Strategist Philippe Gijsels even talks about political chaos in this edition... One thing is certain: investors are not happy about it. Nevertheless, these phenomena belong in their scenario analyses. More attention now seems to be focused on diversification, as was evident during the two asset allocation debates organised by Financial Investigator.
However, diversification is also proving to be a key theme in other areas. For example, when it comes to investing in alternative credit, the subject of a round table discussion organised by Financial Investigator. Various forms were discussed, from direct lending, trade finance and asset-based finance to NAV loans and blended finance.
Leticia Ferreras Astorqui and Nadia Nikolova of Allianz Global Investors discuss the latter form, blended finance, in the cover interview. According to these experts, bringing together public and private capital is an effective way to help emerging markets with their climate plans – with impact and a solid risk-return profile.
This edition focuses on the Wtp transition and its implications for investment policy. One of the funds that has already made the switch is Beroepspensioenfonds Loodsen. Financial Investigator spoke with Rajesh Grobbe, Director of Bestuursbureau BPL, and Willem van Dommelen, Fiduciary Advisor at BlackRock, about the transition process. The lessons they have learned may be useful for the many pension funds that still have to make the transition. This edition contains more lessons for pension funds, for example with regard to points for attention during the transition and for the investment policy afterwards. Who knows, they may help you!
I hope you enjoy the read!
Jolanda de Groot, Editor-in-Chief