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Sam ColtExChangemaker
"So called Business Engineer"

Global public pensions report 2020 from the Official Monetary and Financial Institutions Forum (OMIF)

RV has made really good videos that talked about all the different issues pensions face. 

But in case you wanted extra readings here is this Global pension report you can look into, it is made by insiders and lets you peek at how they see the world. 
There is something in it for everyone, PE, Governance, return assumptions, portfolio construction and also Demographics. 

 

Do you outperform your pension fund? 
Do you outperform your pension fund? 
. Canada Loves PE too
. Canada Loves PE too


At the end, there is also a nice overview of the top 100 public pensions. 
 



 

Geopolitics Today: Weekender Debt Edition

Morning Everyone,

Today was marketably more active in the sphere of Geopolitics, with another story of an emerging market issuing more debt to cover COVID-related expenses. As the economic condition globally continues to deteriorate, I expect that we will see more of these stories appear along with more warnings from yours truly to please not buy them. Regardless I hope all of you have a good day and even better weekend!

US Government Forbids investment in 30 Chinese Companies Connected to Military and Surveillance

Late yesterday evening, President Trump issued an executive order banning investment in more than 30 Chinese companies with ties to the Chinese military and security apparatus. Many of the companies that were names operate in the telecoms, petrochemical, and surveillance equipment sector are listed on US exchanges. This executive order was signed to disincentives US investors, financial institutions, and pension funds from providing capital and dollars to Chinese corporates.

What makes this executive order very interesting is that it doesn't list the penalties or punishments inflicted on this executive order's violators. In its place, it gives the treasury department an open-ended mandate to enforce this executive order under the "Internation Emergency Economic Power Act," which offers a wide range of sanctions options on different levels of severity from sanctions on individuals to the nations banking system.

The use of such a wide mandate allows for several options for the treasury department:

  1. It gives Treasury to punish based on repeat offenders vs. first-timers.
  2. It allows for the... (More)

Older Americans Are Selling The Stock Market To Junior Generations

Allocation in a defined contribution pension scheme for millennials

Interested to hear everyone's thoughts.....In a UK defined contribution company pension scheme, where members can only choose to allocate to a fixed set of investment funds, where would you be right now as someone with a time horizon of another 20yrs? (old millennial!)

My views (and hence the question)

- Allocations to most developed equity funds likely to underperform over the next decade.
- Some potential in certain EM equity markets but they likely have to take some pain first given reliance on USD debt and further COVID damage to their economies.
- Government bonds tied at/close to zero yield forever.
- IG Credit artificially supported by Central Banks. Not yet reflecting true solvency risk.
- Commercial real estate likely to move significantly lower due to economic downturn, behavioural changes and remote working.
- Cash/Deposits to provide close to zero return and eventually be inflated away.
- Commodities - No direct exposure offered in most schemes.
- Precious Metals - No direct exposure offered in most schemes. Fortunately some schemes offer access to a basket of Gold/Silver miners.
- Crypto - No direct exposure offered in most schemes.

A pretty grim set of choices for those looking to plan for the future. I know we have to take a view over our time horizon and a pension is a long one but there just doesn't seem to be many options that make sense right now. With the exception of potentially the miners, the investment set seems to offer little opportunity... (More)