Global Perspectives

In this episode of our “Global Perspectives” series, Global Sustainable Equity Portfolio Managers Hamish Chamberlayne and Aaron Scully join Adam Hetts to discuss the latest trends in sustainability.

Key takeaways:

• The US has undergone a huge shift in its stance towards sustainability, with the new Biden administration, the US Federal Reserve (Fed) and the Securities and Exchange Commission (SEC) all focused on tackling climate change.

• A transformative synchronized investment boom into clean technologies is underway in the US and beyond, with the connection of digitalization, electrification and decarbonization improving efficiency across all industries.

• Low-carbon investing is more than simply investing in renewable energy companies and removing fossil fuels from a portfolio. We see many opportunities in the technology, business productivity and building sectors that all have a place in creating a greener economy.

• Intentionality, transparency and consistency are key tenets that span the broad spectrum of sustainable investing.

One of the biggest challenges retirement plan sponsors face is how to effectively communicate with participants and keep their attention. And in today’s virtual world, it’s more challenging than ever. In this episode of Plan Talk, Retirement Director Ben Rizzuto outlines several ideas for interacting with participants to help them stay engaged with their retirement plans.

Like the prospect of cleaning up a messy room, taking those first steps toward financial independence can feel overwhelming. In fact, 53% of millennials are not sure where to start when it comes to making financial decisions. Retirement Director Ben Rizzuto shares three simple ideas to help younger people clean up their financial rooms through budgeting, controlling spending and making a written plan.

Join Adam Hetts, Global Head of Portfolio Construction and Strategy, as he speaks with Co-Heads of Strategic Fixed Income Jenna Barnard and John Pattullo about whether there is substance to the reflation trade.

Key Takeaways:

• The consensus trade expects inflation, but much of this may already be priced in, creating potential opportunities in medium-term bond yields if inflation proves transitory.

• An excess of private savings before COVID-19 required governments to spend to balance private-sector saving. In some ways, today’s fiscal stimulus is an extension of the response to the deleveraging environment that lingered after the Global Financial Crisis.

• For reflation to be convincing, we need to see evidence that households and businesses are changing their behavior toward taking on more debt – yet credit demand remains soft and markets seem to be ignoring weaker data in China.

Important Information:

Credit Spread is the difference in yield between securities with similar maturity but different credit quality. Widening spreads generally indicate deteriorating creditworthiness of corporate borrowers, and narrowing indicate improving.

Duration measures a bond price’s sensitivity to changes in interest rates. The longer a bond’s duration, the higher its sensitivity to changes in interest rates and vice versa.

10-Year Treasury Yield is the interest rate on U.S. Treasury bonds that will mature 10 years from the date of purchase.

Volatility measures risk using the dispersion of returns for a given investment.

Inflation: a general increase in prices and fall in the purchasing value of money.

Basis point (bp) equals 1/100 of a percentage point. 1 bp = 0.01%, 100 bps = 1%.

Quantitative Easing (QE) is a government monetary policy occasionally used to increase the money supply by buying government securities or other securities from the market.

Reflation: expansion in the level of output of an economy by government stimulus, using either fiscal or monetary policy.

The views presented are as of the date published. Nothing in this document is intended to or should be construed as advice. This document is not a recommendation to sell or purchase any investment and does not form part of any contract for the sale or purchase of any investment. Past performance is no guarantee of future results. Investing is subject to risk, loss of principal and fluctuation in value.

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Adam Hetts, Global Head of Portfolio Construction and Strategy, talks with Head of U.S. Fixed Income Greg Wilensky about the challenges – and unique opportunities – associated with building bond portfolios in a world with historically low interest rates.

Global Head of Portfolio Construction and Strategy Adam Hetts talks to Seth Meyer and Tom Ross, portfolio managers on the high-yield bond strategies, about how with credit spreads gradually tightening, returns will likely become less about market direction (beta) and more about identifying individual opportunities (alpha).

In this year’s final episode of Plan Talk, Retirement Director Ben Rizzuto recaps notable updates, trends and legal cases from the past year in the defined contribution space. And as always, he shares a playlist of his favorite new songs from 2020.

Ben’s Top Songs of 2020:

1. “All That Ever Mattered” – HAIM

2. “I Live at Night” – I Break Horses

3. “Inspirit” – Julianna Barwick

4. “Ingydar” – Adrianna Lenker

5. “Something I Do” – Sweet Whirl

6. “Ghost of Soulja Slim” – Jay Electronica

7. “A few words for the firing squad” – Run the Jewels

8. “Can I Believe You” – Fleet Foxes

9. “Highway” – St. Panther

10. “Lost in Yesterday” – Tame Impala

11. “Born Confused” – Porridge Radio

12. “Michigan Hammers” – Protomartyr

Jenna Barnard and John Pattullo, Co-Heads of Strategic Fixed Income, join Adam Hetts, Global Head of Portfolio Construction and Strategy, to discuss all things corporate bonds. Topics include philosophy, making the right calls during the COVID-19 crisis, chances for an aggressive recovery, the prospects of higher interest rates and whether 2021 offers a sweet spot for credit investing.

Many American workers fear that the Social Security trust could be depleted in the not-so-distant future, which may lead some individuals to collect their benefits early – a decision that can significantly reduce their earned benefit. In this episode of Plan Talk, Retirement Director Ben Rizzuto explains research-based techniques that can be used to help ensure people more fully consider their options and make better decisions regarding when to claim this important earned benefit.

In the latest episode of Plan Talk, Retirement Director Ben Rizzuto and Fixed Income Product Specialist Jessica Leoncini discuss current plan menu designs and investment trends in defined contribution (DC) plans. Referencing the findings from a survey Janus Henderson recently conducted with the Plan Sponsor Council of America, they explain how the lack of adequate fixed income options in many defined contribution plans could affect participants’ ability to retire comfortably – particularly with global interest rates at historic lows.