The Importance of Infrastructure in the Transition to Low Carbon - Part One
From an investment perspective, infrastructure assets have many appealing characteristics. They provide investors with a solid yield and capital returns, underpinned by defensive and stable cash flows, as well as inflation protection and downside protection in negative markets.
This paper is a climate change tryptic and is a must-read for the infrastructure investor. Part One looks at why the climate change situation is so serious, and what role infrastructure can and must play in the transition to a more sustainable future.
Squeezing The Securities Lending Lemon
With pressure on future asset class returns increasing following the post pandemic surge in global equities and yield curves pushed ever lower by central banks, the hunt is on to find new sources of return and portfolio efficiency for institutional asset owners that strive to deliver real returns to meet their expected liabilities in future years. One source of additional return for a portfolio is
securities lending, which offers the potential to generate extra revenues from portfolios. In this article we take a closer look at securities lending, and the potential benefits to asset owners by way of the revenues from lending fees.
Power Play - Large Scale Energy Storage In A Decarbonised Grid
In this article, we focus on three large energy storage technologies – pumped hydro, lithium-ion batteries and underground hydrogen storage - considering the investment case for these asset types that are of growing interest to infrastructure investors
Pushing On A String - Revisiting The Japanese Rate Experience
In this month’s article, we discuss Japanification in the midst and aftermath of the COVID-19 era. We begin by providing a refresher on Japan’s economic experience since the early 1990s. We then turn to the unconventional monetary policy settings that have become conventional across the developed world, and how, when paired with structural issues, the likelihood of a Japanification scenario increases.
Wildfires - Burning More Than Just Landscapes
Climate change and the risks that go with it have been front of mind for investors and regulators alike for several years. In this month’s article, we provide a specific, but very relevant example of how climate change is impacting investors’ portfolios today. Wildfire activity in the state of California has increased dramatically over the past several decades, with 2020 marking the worst year on record.