NEW YORK--(BUSINESS WIRE)--
New Report Provides Further Insights on China, Europe, Portfolio Construction and the Need for Flexibility across Mandates
KKR today announced the release of Another Swing at the Plate, the firm’s latest Insights report by Henry McVey, Head of Global Macro and Asset Allocation (GMAA). In this follow-up to the 2019 Global Macro Outlook, The Game Has Changed, the GMAA team drills down on four key issues raised by clients and others after the publication of the 2019 Global Outlook.
“Given the current state of affairs around the world these days, we are not totally surprised by the questions we’ve received, as investors consider where to deploy and harvest capital in today’s unsettled environment. What has been surprising, though, is how concentrated the questions have been around a few key topics. So, in response, we are taking another “Swing at the Plate,” Henry McVey says.
In Another Swing at the Plate, the GMAA team posits the following:
|1.||In terms of ongoing trade tensions, China’s desire to internalize its economy has been a long-standing goal that accelerated after the Global Financial Crisis, long predating the election of President Donald J. Trump.|
|2.||Despite the heightened geopolitical tensions throughout Europe, significant investment opportunities exist, particularly within private investments that offer alpha for capital allocators who are willing to take more of a top down approach to deployment in the region than they might typically otherwise do. As part of this analysis, sound portfolio construction in Europe is becoming a differentiating feature, given intensifying macro headwinds.|
|3.||There are several structural forces at work that require investor attention when it comes to assessing the future role of sovereign debt in portfolios. Consistent with this view, we think that we are at an inflection point in the U.S. fixed income markets, one that argues for buying shorter duration cash flowing assets linked to nominal GDP and decreasing exposure to longer duration sovereign debt.|
|4.||Given our call for lower overall returns with greater dispersion of outcomes, we believe that having the flexibility to invest across asset classes during periods of dislocation is becoming increasingly important across both public and private markets.|
Links to access this report as well as an archive of Henry McVey's previous publications follow:
- To read the latest Insights, click here.
- To download a PDF version, click here.
- To download the KKR Insights app for iOS click here, and for Android click here.
- For an archive of previous publications please visit http://www.KKRinsights.com.
About Henry McVey
Henry H. McVey joined KKR in 2011 and is Head of the Global Macro and Asset Allocation team. Mr. McVey also serves as Chief Investment Officer for the Firm's Balance Sheet and oversees Firmwide Market Risk at KKR. As part of these roles, he sits on the Firm's Investment Management & Distribution Committee and the Risk & Operations Committee. Prior to joining KKR, Mr. McVey was a managing director, lead portfolio manager and head of global macro and asset allocation at Morgan Stanley Investment Management (MSIM). Learn more about Mr. McVey here.
KKR is a leading global investment firm that manages multiple alternative asset classes, including private equity, energy, infrastructure, real estate and credit, with strategic partners that manage hedge funds. KKR aims to generate attractive investment returns for its fund investors by following a patient and disciplined investment approach, employing world-class people, and driving growth and value creation with KKR portfolio companies. KKR invests its own capital alongside the capital it manages for fund investors and provides financing solutions and investment opportunities through its capital markets business. References to KKR's investments may include the activities of its sponsored funds. For additional information about KKR & Co. Inc. (KKR), please visit KKR's website at www.kkr.com and on Twitter @KKR_Co.
The views expressed in the report and summarized herein are the personal views of Henry McVey of KKR and do not necessarily reflect the views of KKR or the strategies and products that KKR offers or invests. Nothing contained herein constitutes investment, legal, tax or other advice nor is it to be relied on in making an investment or other decision. This release is prepared solely for information purposes and should not be viewed as a current or past recommendation or a solicitation of an offer to buy or sell any securities or to adopt any investment strategy. This release contains projections or other forward-looking statements, which are based on beliefs, assumptions and expectations that may change as a result of many possible events or factors. If a change occurs, actual results may vary materially from those expressed in the forward-looking statements. All forward-looking statements speak only as of the date such statements are made, and neither KKR nor Mr. McVey assumes any duty to update such statements except as required by law.