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Multi-Asset Strategy Team
Multi-Asset Strategy ResearchMulti-Asset Strategy Products: Multi-Asset Strategy Monthly, Multi-Asset Strategy Weekly, Absolute Essentials, Trade Alerts.
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We argue the past twelve months’ cheapening in EUR break-evens must be blamed on market directionality, not fundamentals. We look at inflation break-evens’ investing implications.
Sentiment, Positioning and Risk Essentials: Six key charts in multi-asset
Absolute Essentials is taking a brief break from full service this week.
This snapshot provides key current market sentiment and positioning highlights across markets: with MSCI ACWI, CAC 40, the euro, Copper and UST 10Y in the spotlight.
At almost $0.5tn, gross inflows to private equity have broadly equalled gross inflows to public equity over the past year, but AUM in private equity is still only about 6% of public equity market capitalisation
For most of this decade, apart from 2018, public equity returns have been broadly comparable to private equity returns; moreover, the IRR metric used in private equity likely flatters total returns on committed capital
Listed small cap returns have almost returned as much as private equity over time – although a wide dispersion of returns in private equity suggests the top performing funds can offer significant yield enhancement
At $1.5tn, ‘dry powder’ is almost 10% of the size of the US Treasury market, but at c.35% of AUM, we believe the main risk it poses is to return generation
The use of leverage suggests private equity may not be entirely immune to a downturn, and loan quality is a potential source of market instability
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