Apr 19, 2023
Dive deep into the world of asset allocation with Anubhuti Gupta, CFA, CIPM, a senior principal consultant for Mercer's Wealth business in Singapore. We discuss the impact of inflation on portfolios and how investors can structure them for resilience amidst inflationary pressures. We also explore the challenges of diversification in 2022 and the importance of private markets in portfolio allocation. Additionally, we touch on the benefits of investing governance, the role of Outsourced Chief Investment Officer (OCIO) providers, and the importance of keeping an open mind throughout our investment careers. Join us in this insightful conversation as we navigate the ever-changing landscape of investing and asset allocation.
Chapters:
(0:00:03) - Asset Allocation in Inflation
(0:09:26) - Diversifying Portfolios in an Unpredictable Market
(0:20:02) - Benefits of Investing Governance
(0:23:43) - Keeping an Open Mind
Chapter Summaries:
(0:00:03) - Asset Allocation in Inflation (9 Minutes)
We discuss the impact of inflation on portfolios and how investors
can structure their portfolios for resilience in the face of
inflationary pressures. Anubhuti highlights the importance of
focusing on energy efficiency, security, infrastructure,
technology, and materials to facilitate the transition. We also
delve into the potential for value stocks to outperform in the
current market environment, as growth equities may struggle to
recover to previous market highs'
(0:09:26) - Diversifying Portfolios in an Unpredictable Market
(11 Minutes)
Diving into the challenges of diversification in 2022, we discuss
the risks associated with relying on traditional strategies like
the 60/40 portfolio. With equities and bonds producing negative
results simultaneously for the first time in many investors'
careers, it is essential to consider more dynamic approaches, such
as incorporating specialist downside risk mitigation strategies or
using real assets. We also touch on the importance of private
markets in portfolio allocation, emphasizing their continued
relevance for those with long horizons and a desire for innovation.
However, it is crucial to reassess portfolio risk and exposure
levels in the context of both public and private markets.
(0:20:02) - Benefits of Investing Governance (4 Minutes)
As we examine the disconnect between private real estate and REITs,
we consider the potential opportunities that may arise when
valuations for private real estate funds align with reality. We
stress the importance of maintaining a long-term view and avoiding
short-term panic-driven decisions that may be detrimental to the
portfolio. Discussing governance and the outsource CIO (OCIO)
model, we highlight the benefits of working hand in hand with asset
allocators to manage assets as opposed to in-house management. This
approach allows for streamlined decision-making processes and the
ability to take advantage of market dislocations and emerging
opportunities.
(0:23:43) - Keeping an Open Mind (3 Minutes)
In this conversation, we delve into the concept of Outsourced Chief
Investment Officer (OCIO) providers and their role in easing the
pain points for asset allocators and investment teams. By
outsourcing certain aspects of the value chain to OCIO providers,
entities can focus on high-value activities where they excel.
Additionally, we share some personal insights from Anubhuti Gupta's
career journey, emphasizing the importance of keeping an open mind
for both young and seasoned professionals in the industry.