We explore the implications of a potential equity sell-off, where we hypothesize that less-risky, more-profitable firms with more-conservative investment practices prove more resilient than their competitors. 

When investors assess risk, they construct narratives around the data. Investment managers and asset allocators can look to the long history of market sell-offs for context, to better anticipate future drawdowns and prepare portfolios for what the future may hold. 

The global-market portfolio represents the aggregate financial assets of all investors worldwide. Institutions can benefit by monitoring its composition and evolution, to shed light on investor preferences, as well as trends in asset-class weights. 

We explore three scenarios of varying severity for European credit, with outcomes for a multi-asset European portfolio ranging from a 2% return in a “mild recession” scenario to an almost 11% drop in a “sharp global recession,” according to our model. 

Bond investors looking to reduce their portfolios’ carbon footprint may decide to shift capital from high to low emitters. Did a decarbonizing approach that preserves sector exposures significantly change the main portfolio risk characteristics? 

The unfolding European energy crisis is causing havoc among energy producers and utilities. How could soaring energy prices affect companies from the perspective of energy consumption? 

Carbon footprinting across multi-asset-class portfolios allows investors to measure financed emissions and inform decarbonization decisions. We examine this important step toward managing the net-zero journey.

Investors can use different metrics to track their portfolios’ carbon footprint. Regardless, they will increasingly need tools to better identify the sources of changes in whichever climate metrics they use. We present an attribution methodology.

Given climate risk’s multifaceted nature and the long time horizon on which climate change is unfolding, investors face an elevated level of uncertainty when making decisions. What approaches can they take as they seek to manage these risks?

We analyzed two multiperiod inflation scenarios to understand how the funding ratios of defined-benefit pension funds could evolve in each and what they could mean for a pension fund in terms of special contributions over the next 10 years.

For long-horizon investors that aim to ride out volatility, short-term risk measures may be insufficient. We used multiperiod stress testing to evaluate one- and five-year returns of hypothetical multi-asset-class portfolios using 50 years of history.

Will inflation rear its ugly head in the U.S.? Although the outcome of the U.S. elections might have lowered inflation expectations, investors can prepare for scenarios where inflation goes up. In this stress test, we examine three scenarios for inflation over varying time horizons.