Reprint
Coming off a 30-year high in the U.S. Consumer Price Index in October 2021, institutional investors have been concerned with whether the recent inflation spike signals the start of a new and persistent phase of higher inflation or a transitory hike. Pensions & Investments spoke with Vince Childers, Head of Real Assets Multi-Strategy who shared his recommendations for institutional investment portfolios.
Timestamps and questions:
0:40 – What is your view on inflation & what are its drivers today?
3:18 – What role can real assets play in protecting portfolios from long term inflation?
6:24 – Could you talk about valuations and where Cohen & Steers is overweight in real assets portfolios?
ABOUT THE AUTHORS
Vince Childers, CFA, Senior Vice President, is Head of Real Assets Multi-Strategy and a portfolio manager for Cohen & Steers’ real assets strategy.
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Please see important disclosures and risks below.
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The views and opinions are as of November 2021 and subject to change without notice and represents an assessment of the market environment at a specific point in time, should not be relied upon as legal, investment or tax advice and is not intended to predict or depict performance of any investment. We consider the information to be accurate, but we do not represent that it is complete or should be relied upon as the sole source of appropriateness for investment. Investors should consult their own investment professional with respect to their individual circumstances.
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Risks of Investing in Real Assets. A real assets strategy is subject to the risk that its asset allocations may not achieve the desired risk-return characteristic, underperform other similar investment strategies or cause an investor to lose money. Risks of investing in REITs are similar to those associated with direct investments in real estate securities, including property values may fall due to increasing vacancies, declining rents resulting from economic, legal, tax, political or technological developments, lack of liquidity, limited diversification and sensitivity to certain economic factors such as interest rate changes and market recessions. The value of commodity-linked derivative instruments may be affected by changes in overall market movements, commodity index volatility, changes in interest rates, or factors affecting a particular industry or commodity, such as drought, floods, weather, livestock disease, embargoes, tariffs and international economic, political and regulatory developments. The use of derivatives presents risks different from, and possibly greater than, the risks associated with investing directly in traditional securities, including market risk, credit risk, counterparty risk, leverage risk and liquidity risk and can lead to losses because of adverse movements in the price or value of the underlying asset, index or rate, which may be magnified by certain features of the derivatives. Securities of natural resource companies may be affected by events occurring in nature, inflationary pressures and international politics. Global infrastructure securities may be subject to regulation by various governmental authorities, such as rates charged to customers, operational or other mishaps, tariffs and changes in tax laws, regulatory policies and accounting standards. Foreign securities involve special risks, including currency fluctuation and lower liquidity.
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