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Tuesday, February 7, 2023

Expert Jay Peller predicts what the money prospects are for the new year

The world’s central banks have been trying to rein in global inflation with relatively little effect. black Rock believe that central banks are “deliberately causing recessions by tightening more than they intended to prevent it”, a view shared by many asset managers.

Then, What does all this mean for 2023? Many of the macroeconomic conditions of 2022 will continue into the new year, although each year brings its own set of challenges. in a recent interview with valuewalk, J Peller of Citco Group of Companies, said he continues to see a bright future for Alternative Investments in 2023,

“As investors adjust to the new market environment and seek alternative investments that provide them with diversified sources of potential returns, we expect end-investors to enter a greater number of hedge funds, private equity, and equity portfolios in 2023. , Will continue to turn to private equity and real.” ” He said.

Jay Peller - Global Custodian

Jay Peller – Global Custodian

Will commodity and macro funds continue to be big winners?

For most of 2022, macro funds were among the biggest blockbusters, helped by rising interest rates, rising commodity prices and currency volatility as the dollar strengthened against other currencies.

However, data from CITCO reveal that commodity fund In fact outperformed global macro funds by the end of November, delivering weighted average returns 19,49% and average return 12,99%. Global Macro Funds follow closely behind with a weighted average return of 16.47% and an average return of 10.75%.

Across strategies, CITCO-managed funds delivered an overall weighted average return of -6.49% and an average return of -3.5% in the first 11 months to 2022. Have a recession

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The Fed has made it clear that it will continue to raise interest rates until inflation is under control. As a result, debate has heated up as to whether the central bank will be able to concoct a so-called “soft landing”. All of these dynamics suggest that macro fund managers may find themselves in a few positions, like the one they capitalized on in 2022.

investor flows

Of course, no one knows whether 2023 will bring a net inflow or outflow for macro funds or for the sector as a whole. However, it may take a few months before any trend becomes clearly apparent.

In November, Citco mentioned exit plans $9.5 billion until 2023, although the exact timing of those flows will remain unclear until the last day of the year. Overall, Peller expects 2023 capital inflows to be somewhat similar to 2022.

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More Offerings of Private Debt, Hybrid and Multi-Strategy Funds

They are also expected to see a rise in private lending strategies as fund managers take advantage of the gap left by banks, who can no longer lend as much as before.

“Many private lending strategies have experienced tremendous growth over the last two years,” Peller said. “I think growth will continue into next year, and I think all the complexities will continue as far as regulation and cost go.”

In 2022, you are also looking at more and more pure ESG (environmental, social and governance) funds. Looking ahead to 2023, they expect to see even more ESG funds.

Sustainable Finance In Argentina

Sustainable Finance in Argentina

Peller is also expected to increase multi strategy fund, Which became increasingly popular in 2022. Citco has 6 billion dollars managed multi-strategy funds during the first 11 months of the year, despite a weighted average loss of 7.12% and an average loss of 2.53% during that period.

loss hybrid fund Their popularity also increased in 2022, based on net inflows of $31 billion for the first 11 months of the year. Fund managers have responded to that interest by expanding their funds and offering new hybrid strategies. For example, a long/short equity fund manager may add a private equity vehicle to help smooth their liquidity and overall returns.

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deal with increased complexity

Of course, as hedge funds try to generate returns in different places, they are becoming more and more complex. This increased complexity is leading to much more data being generated and analyzed. As a result, hedge funds require technology capable of performing more complex data analysis. Peller believes that fund managers who do not invest in such technology could be left behind.

“As managers increase their complexity to meet investor demands, we expect outsourcing demand to continue to skyrocket as the need for digitized data and processes grows,” he added.

Peller expects the transformation of hedge funds and investment in newer and more advanced technology to continue in 2023.



mounting rules

Another part of that growing complexity is the growing number of regulations that fund managers have to deal with each year. In 2022, Europe implemented sweeping new rules requiring investors to start collecting data about the companies in which they invest. Those requirements will be even more difficult to meet in 2023.

“Along with the challenging market environment, managers also have to adapt to changing regulatory requirements,” says Jai. “With the entry into force in January 2023 of the Tier Two requirement of the Sustainable Finance Disclosure Regulation (SFDR) … there will be even greater demand for transparency and information from investors.”

Note published in Forbes US.

World Nation News Desk
World Nation News Deskhttps://worldnationnews.com/
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