L&G Talks Asset Management

While his distinctive Canadian twang might give him away, but Howie came to the UK to study law and fell in love with the place. A lawyer by training, he saw that would provide a useful structure of skills for transferring to a more commercial industry.  From his time advising hedge funds to his current role as Head of ETFs, Howie has seen the index industry transformed over the years. Just 10 yea...

Many investors don’t think they need an ETF trading strategy – that is until it’s too late. After all, how different can it be from trading a stock?  But buying and selling ETFs requires a much clearer view on the liquidity of the underlying securities. According to this week’s guest, Annacarla Dellepiane, Head of ETF Capital Markets, employing best practices can shave crucial basis points off of...

Where have all the deficit hawks gone? With mainstream politicians no longer comparing government finances to household saving habits, it appears that a new wave of fiscal spending is on the horizon.      This is part of a growing debate around Modern Monetary Theory, also known as MMT or “a dangerous proposition” if you’re the ECB, about why spending should only be constrained by inflation, how u...

Sonja brings a wealth of experiences to her new role as Chief Investment Officer. But at school, her dream job would have been to become a professional horse-rider and fill her time with dressage and show jumping. An apprenticeship at Deutsche Bank introduced her to the world of finance but it was internships at DWS, a consulting practice and in marketing for a not-for-profit organisation which sh...

We’d all love to predict with pinpoint accuracy the timing of any future bouts of volatility and the impact it would have for schemes’ returns. In turbulent times, investing can be like an endless game of ‘whack-a-mole’ – as one risk is removed, another can come to light. While fortune-telling might not yet be an exact science, there are still a number of methods defined benefit schemes can employ...

The responsibility for people’s financial futures has increasingly been transferred to the individual yet a broad majority of the population remain wary of investing. Asset managers, advisers and pension schemes need to emotionally engage people to make investing not only relevant but also appealing. Technology is by no means the panacea to this challenge but it can be a crucial component of that...

Question: Are people at parties talking to you about stocks?    If the answer is ‘yes’ then (1) you could be going to the wrong sorts of parties or, more likely, (2) this could be a qualitative indicator that the economy is in ‘bubble’ territory.   This episode looks at the ways investors can use quantitative and qualitative indicators to try and forecast the next economic recession. After a valia...

How will the FCA clarification that environmental, social and governance (or ESG) considerations are “financially material” risks affect the IGC’s approach to scheme oversight?  Daniel Godfrey, LGIM IGC member and former chief executive of the Investment Association, discusses what the IGC’s expanded powers mean, what LGIM’s approach to ESG integration means for pensions, and future risks and oppo...

The target absolute return sector has been unloved to say the least. With the offer of ‘investment nirvana’, as Square Mile’s Richard Romer-Lee puts it, these funds look to reduce volatility and still deliver performance in difficult markets.      In this conversation, I sat down with Richard and LGIM’s own Head of UK Retail Distribution, James Crossley, to discuss whether this is a ‘genre, not a...

Working in her father’s London clothes shop taught Honor two things: that she loved meeting people from all over the world, and that she also loved to sell. In her time in sales teams over her career, she has sought to surround herself with a talented team with great culture – a key combination which helps push everyone to perform to the best of their ability.     In this episode of In Conversatio...

Good governance is crucial to all boards, whether they oversee a FTSE 100 multinational, a multi-billion pound pension scheme or a national charity. There is no one-size-fits-all approach to how boards should be run but through Sacha and his team’s extensive experience in corporate engagement, they’ve learned that there are plenty of ways to evolve and enhance effectiveness.    We know that pressu...

We’ve heard a lot about the need for urgent climate action in the past few months. Sobering documentaries from David Attenborough and hard-hitting activism from Greta Thunberg and the Extinction Rebellion have brought the issue to the forefront of people’s minds. Investors have a pivotal role in meeting the challenge of financing the transition to a low-carbon future and in finding the wealth of r...

Is a four day working week realistic — or desirable? Chris Jeffery from our Asset Allocation team and Lara Bernard-Villeneuve in our Active Fixed Income team have looked at the data and think it’s more than a leftist’s pipe dream. Set in the context of a history of declining working hours in industrialised countries, the move does not seem so stark – and need not necessarily trigger a drop in wage...

In this episode, we talk to Madeleine about her path from netball to new issues. Growing up in Lancashire, she studied Mathematics and Economics, before starting her career on the fixed income floor at Barclays. Having moved from investment banking to asset management nearly four years ago, she can no longer call herself a newbie. Madeleine talks through the changes she has seen so far during her...

Once again we’ve gone behind the scenes to find out how LGIM’s investment teams manages funds. The Active Equities team places a major emphasis knowing the companies in which they’re invested inside and out. This could be anything from knowing how a company will respond to a competitor’s latest innovation to how their strategy will hold up for the next 10 or 30 years. It’s all about building that...

It’s said that the only thing that goes up in falling markets is correlation. Diversification across uncorrelated assets, differentiated sources of returns, and foreign currency exposure can help provide natural risk hedges and still deliver the performance sought by investors. This week, we’re talking to members of LGIM’s Asset Allocation team about why investors need to diversify with purpose an...

The race to provide faster broadband is on. But will incumbents be disrupted by the challenger providers: the 'altnets'? The upcoming set of results from BT and their strategy for the future will be crucial in determining the answer. In 2018, UK consumers spent a total of one day a week online, more than twice as much as in 2007. Time spent online, demand for data and the number of devices connect...

This week we’ve returned to that famous British obsession: housing. Now that 20% of the UK population are choosing to rent their home, the expectations of lifestyle renters for their home developments have risen accordingly – such as allowing pets or permanent decoration. The build to rent sector involves the large scale development of new housing stock with the needs of ‘lifestyle renters’ in min...

Variable or fixed rate mortgage? That’s the first question asked once someone knows you’re an economist, in James’s experience. Despite an original plan to study computer programming, when the school didn’t offer the course he turned to economics, following it through academia and into the Treasury. From the world of computer games to interest rate expectations, we explore James’s search for the u...

From the Melrose-GKN bid to the first results of our Climate Impact Pledge, 2018 was a crucial year for better understanding the decisions companies make and how we can make sure the interests of investors are looked after. Technological developments mean that companies are disclosing more data than ever before on their policies and other environmental, social and governance (ESG) metrics, informi...

Investing in the Chinese economy often deals with particularly impressive numbers. This is an economy which has tripled in size since 2005, even now contributing approximately a third of all world GDP growth despite fears that China’s growth has fallen to a ‘mere’ 6%. When a fifth of all travel expenditure comes from the less than 10% of Chinese citizens who hold passports, the Chinese consumer is...

The recent soft patch in growth and dovish shift from the Federal Reserve has made it less likely that the US enters recession next year. While 2019 may not be the year that the US wholly reinvests in its crumbling infrastructure, it’s certainly at the top of both parties’ 2020 policy targets and neither side will want to be outdone. The market has become very pessimistic about infrastructure-rela...

As record numbers look to integrate sustainable investment considerations into their portfolios, it comes as no surprise that the world of factor-based investing is not immune. According to a 2018 survey conducted by FTSE Russell, 55% of factor investors are looking to incorporate environmental, social and governance (ESG) company analysis but as yet, there’s been no well-defined blueprint as to h...

What do you think of when you hear the word ‘millennial’? The archetype most prevalent in advertising and popular culture is one of an early-twenties, affluent (but not too affluent), city-dweller. But the 1.8 billion generation known as millennials are anywhere between the ages of 23 and 37 – by and large they have left undergraduate education, are well established in the workforce and their spen...

In the late 1990s, when the world of equities was one of pinstriped suits and hard sells, European credit presented exciting new opportunities with a brand new currency. Leaving Lehman Brothers just a few months prior to its downfall, Ben came to Legal & General Investment Management at the epicentre of the global financial crisis. Understanding the financial world as one of simply matching bo...