Our latest Advance magazine leads on how we engage with carbon companies, plus all the latest developments in sustainability investing. Read more ...
The falling cost of technology allows us to connect all sorts of devices to the internet at an increasing pace. The vast amount of generated data can be used to get insights and automate processes in our homes and workplaces.
Power generation requires substantial investments and long-term planning by the power generators. At the same time their strategies are greatly affected by regulatory decisions as a substantial part of the market remains regulated or impacted by regulatory decisions (e.g. subsidies).
In the second half of 2014, Robeco began working on an engagement project related to the quality of the corporate board of financial companies. Several selected companies are assessed on the ability of their supervisory board (SB) to perform its supervisory duties in the appropriate manner and the ability of their management board (MB) to realize the company's strategic objectives.
To the best of our knowledge, no study has been conducted on the added value of innovative investment strategies that incorporate academic insights. As a result, we do not know how many investment managers have incorporated academic insights or how successful they are. We have researched the topic to fill this gap in the literature.
The recent update of the RobecoSAM Country Sustainability Ranking shows Sweden maintaining its firm lead, while Brazil turns out to be the biggest loser. Morocco stands out among the emerging market winners.
An interdisciplinary working group of Robeco and RobecoSAM specialists did engagement research into the ESG risks and opportunities of the biopharmaceuticals industry. Biopharmaceutical companies are important, as they control unique products that can greatly alleviate the burden of disease.
Easy stock price gains will be a thing of the past in 2016. This is why we are focusing even more on good quality companies with solid cashflows and high returns on invested capital. Europe and Japan are our favorite developed markets.
This year has really kept investors on their toes. Central banks set the tone again, but geopolitical developments also played a role. Volatility has increased and shows no sign of disappearing as we move into 2016. This does not mean that investors should be pessimistic about the coming year. We talk to Hans Rademaker, Robeco's Chief Investment Officer.
In recent months, several telecom companies with operations in emerging markets were faced with corporate governance issues. These issues had huge consequences and highlighted the negative risks for bondholders. They show that integrating environmental, social and governance (ESG) factors into the analysis is key in assessing the downside risk of credit investments.
Emerging markets are going through a volatile period, but the defensive investment strategy of Robeco Emerging Conservative Equities is proving its worth by outperforming the index. “Despite its relatively short history, we are very confident about the fund as is demonstrated by its Bronze Morningstar Analyst Rating. The results are more than promising.”
The added value of allocating to emerging markets (EM) has always been a topic of discussion among equity investors, especially when there was a large difference in performance with developed markets (DM). After a period of market decline, investors sometimes consider to lower the weight of emerging markets in their portfolio. What are the lessons that history can teach us?
Investors are still awaiting the first rate hike by the Federal Reserve since June 2006. According to Bloomberg, since the last Fed statement, at the end of October, the odds for a December rate hike have risen from 37% to 48%.
The Chinese Communist Party recently approved the 13th Five Year Plan for China’s economy. In addition to targeting a GDP growth rate of around 6.5% per year, the government aims to improve the population’s living standard and take concrete measures to protect the environment.
ECB President Mario Draghi is open to a whole menu of monetary policy instruments. Lukas Daalder, Chief Investment Officer for Robeco Investment Solutions, analyzes the selection of dishes, assesses the likelihood of implementation and looks at the impact on financial markets.
Rolinco, Robeco’s flagship growth equity fund, is celebrating its 50th anniversary this year. Time to look ahead to the next 50 years. What will the world look like in half a century’s time and how can investors benefit from this now?
Emerging markets have been battered indiscriminately these past months. Now that the baby has been thrown out with the bathwater, it’s time to pick those stocks that have been unfairly hit and that can outperform in the medium to long term.
Is the Fed about to make a policy error by raising rates too soon? The whole of this year financial markets are obsessed with the question whether the Fed will start normalizing short-term rates. Fed policy makers have fueled the discussion themselves by speaking out intentions to do so.
Brazil is in recession territory. The country’s fiscal consolidation plan had a major set-back in July as finance minister Joaquim Levy announced a significant downward revision of the government’s primary fiscal surplus targets. Last month, S&P downgraded Brazil’s rating from Investment Grade to junk. Capital outflows have intensified and the currency has devalued very rapidly.
“This is not a black and white story. The opportunities lie in the gray area.” Portfolio manager Fabiana Fedeli has just returned from a trip on which she spoke with a number of political, financial and economic experts on the situation in China.
Every year GRESB (Global Real Estate Sustainability Benchmark) conducts a survey that serves as input for its sustainability benchmark. Robeco uses this benchmark to engage with companies in which we invest in order to improve the real estate sector’s sustainability. Robeco Property Equities scores well above the average.
Morningstar’s increased confidence in Robeco BP Global Premium Equities has led to an upgrade of its Morningstar Analyst Rating from Bronze to Silver. ‘A solid option for investors who want to invest in global equities. It uses a consistent and proven investment process.’
More and more money is poured into alternative investments by institutional investors. In this magazine we look at the risks and opportunities in alternatives such as hedge funds, real estate, private equity and commodities.
Strong brands is one of the trends Robeco Global Consumer Trends Equities capitalizes on. Fund manager Jack Neele discusses Interbrand's latest 100 most valuable brands. And talks about relevant brands and brands that miss the boat.
After the US subprime crisis in 2008 and the European sovereign crisis in 2010 we have now reached the third leg of the Global Financial Crisis with the unwinding of the emerging markets credit-fueled boom. Europe seems to be the oasis of quiet.
Factor investing has been successfully applied to equity markets. It can also work in the corporate bond market and can generate substantial premiums. An interview with portfolio manager and researcher Patrick Houweling.
As institutional investors search for higher returns and better opportunities for diversification, they often opt for illiquid investments. But do these asset classes really offer the right return characteristics? Robeco’s conclusion is that effective manager selection is crucial.
Investors should not fear an imminent break-up of Spain after separatists in Catalonia won control of the regional parliament but did not get over 50% of the popular vote, says Robeco’s Chief Economist Léon Cornelissen.
Robeco Chief Economist Léon Cornelissen would like the current migration issue to be a catalyst for further European integration. "If the three percent budget deficit ceiling is relaxed in order to release funds for the refugees, that's not a bad idea from an economic point of view."
Investing in illiquid asset classes has become increasingly widespread among pension funds in the last few decades. There are a number of reasons for its increasing popularity, including the notions of higher expected returns and the potentially greater diversification opportunities that illiquid investments can offer.
Half of all the results of clinical trials carried out on thousands of patients have never been made public, according to research by Sense About Science. The charitable trust runs the AllTrials campaign to try to disclose as many results as possible. Peter van der Werf, Engagement Specialist at RobecoSAM, explains how he is working with listed pharmaceutical companies to try to improve clinical trial transparency.
“We wanted to create an alternative to the existing active and passive ESG solutions.” Portfolio manager Machiel Zwanenburg manages RobecoSAM Quant Sustainable Global Equities (QSGE) together with Peter Ferket.
Jan Keuppens and Willem Schramade explain how ESG is integrated in the analysis and valuation of equities for Robeco Global Stars Equities. "We are thus able to make better informed investment decisions."
Investors increasingly want to use their investments to achieve a positive social or environmental impact. Our ambition is to do this without compromising financial returns, says Daniel Wild, Head of SI Research & Development at RobecoSAM.
Charles Groenhuijsen interviewed Léon Cornelissen and Lukas Daalder on the main themes and issues of Robeco’s ‘Expected Returns 2016-2020’. Both are fairly optimistic about the world economy through to 2020. The re-emergence of inflation and rising rates will eat into sovereign bond returns, so both Cornelissen and Daalder prefer equities. They remain more bullish than bearish as the world continues to recover.
The music sector has been re-shuffled by technology, Airbnb checked into the hospitality service sector and the most striking technological disruption is perhaps the drive-by shooting of Uber on the taxi-branch. These industries have been ‘robin-hooded’ by technology companies. Is the payment sector next?
If we only had the published macro data of the US and Eurozone to go by, we would probably have concluded that August was a boring month: most economic data published was in line with expectations, showing a path of steady growth.
According to Edith Siermann, Chief Investment Officer Fixed Income at Robeco, the active way in which Robeco navigates changing market conditions and its leading position in the area of sustainability are a perfect illustration of what sets Robeco apart.
ESG integration has been applied in equity investments for years, but it has only recently started to gain widespread interest in fixed income. We interviewed Edith Siermann, CIO Fixed Income and Manager of SI at Robeco. Edith and her team were one of the pioneers of ESG integration over six years ago
A paper* suggests scaling a conventional momentum strategy by its 6-month historical realized volatility in order to target a constant risk level. The authors find that this volatility scaling doubles the risk-adjusted performance of a momentum strategy, and significantly reduces drawdowns.
Absolute-return solutions can help to make your portfolio less sensitive to the economic cycle. It's difficult to navigate through the rapidly growing range of funds, with a larger portion of these funds bobbing along with the market than the name would suggest.
Private equity has much in common with equity investment, given that both involve investing your own assets in businesses. The main difference is that in private equity a premium can theoretically be harvested due to its illiquid character.
The sudden decline of the renminbi sent a wave of uncertainty through international equity markets. But in the eyes of various specialists at Robeco, the decision to allow the Chinese currency slightly more freedom of movement deserves applause not panic.
The huge decline of Chinese equities is a sign of increasing market volatility rather than the start of a bigger correction, argues Lukas Daalder, Chief Investment Officer for Robeco’s Investment Solutions.
Hedge funds are surrounded by a certain mystique. There is something secretive about the way they operate. They are regarded as products that can make a profit irrespective of market direction. But are they really appropriate for an institutional portfolio?
The holiday season is always a good time to catch up on some reading, on the beach or on an aircraft flying off to sunny climes. We asked some key people at Robeco what they have read, or will be reading, while taking a much-needed vacation.
Its stable rental income makes real estate a popular choice in periods when interest rates are low. According to Folmer Pietersma, fund manager of Robeco Property Equities, real estate prices will not automatically come under pressure if interest rates start to rise again.
For our quantitative equity strategies we aim to minimize trading costs. We have developed our own trading cost model to estimate pre-trading costs. Trade evaluation results shows that we have realized cost savings of over USD 40 million for our clients over the 2009-2014 period.
Food companies are forced to re-evaluate their product portfolios due to the rising concern over whether they promote obesity. In the credit team we examine the downside risk of this trend on the companies we cover. Earlier this year, Robeco’s equity analyst, credit analyst and RobecoSAM sustainability analyst visited companies to discuss obesity related ESG considerations. This deepened our understanding of the companies’ efforts.
KB Financial is a financial conglomerate based in South Korea and parent company of Kookmin Bank, one of the largest banks in South Korea. Investors have long been concerned about the company’s corporate governance. After a relatively short engagement process, we were pleasantly surprised by the proactive stance of the company’s new chairman who announced various measures to improve the company’s governance.
In April 2010, the BP-operated Gulf of Mexico deepwater drilling platform Deepwater Horizon caught fire as a result of the Macondo well blowout, killing 11 employees and causing an estimated 4.9 million barrels of oil to spill into the sea. BP was confronted with litigation cases, fines, negative media coverage and a fall in its share price. This triggered us to start an engagement with 10 companies involved in deepwater drilling.
Most academic studies on factor investing are about equities. Patrick Houweling and Jeroen van Zundert show that factor investing also works for bonds. How has their research paper been used to create a fund?
In its outlook for the third quarter of this year, Robeco’s Global Fixed Income Macro team shares its views on Treasuries, credits and emerging debt and explains its positions in Rorento Global Total Return Bond Fund.
Increasing takeover activity, fluctuations in the oil price and an outlook of rising interest rates are creating new opportunities and dangers for high yield bonds: this is the domain of Sander Bus, fund manager of the Robeco High Yield Bonds Fund.
There are clear indications that the Federal Reserve is going to raise interest rates for the first time in more than nine years this September. Kommer van Trigt, manager of the Rorento Total Return Bond Fund, looks at the arguments for and the likely effects of a rate hike.
An increasing amount of scandals in the news have revealed the risks involved with data privacy. The topic of data privacy is however under-researched in the investment industry. As the risks can impact companies’ earnings, it is important to create more transparency. Engagement specialist Daniëlle Essink had the issue researched.
Very low interest rates mean investors are faced with a dilemma – be satisfied with minimal returns on safe bonds or move higher up the risk curve. Lukas Daalder, chief investment officer at Robeco, discusses the possible options in the current market.
A market strategist once said that “if you buy commodities, you are betting against the ingenuity of people”. When natural resources become too expensive, human resources step in to find alternatives, says multi-asset investment head Lukas Daalder.
European stock markets fell sharply as the extent of the problems in Greece became evident last weekend. Lukas Daalder, Chief Investment Officer of Robeco Investment Solutions, explains where the real issues lie, and what investors can expect in the days to come.
In our latest Credit Quarterly Outlook, we note two changes that are taking place in the credit markets. First, the US credit cycle is becoming unfriendly. Corporate releveraging is accelerating and margins have peaked.
In the recent-sell-off on global government bond markets, Robeco Lux-o-rente managed to maintain a positive year-to-date return with its active duration positioning. This illustrates the importance of an active investment approach.
Robeco has been proud to sponsor Team Brunel, the Dutch entry into the nine-month Volvo Ocean Race. In this edition of Time2Read, we include some stunning new pictures and new or updated stories that capture the highlights of the eight e-magazines that we have produced for the ports visited by the race.
Since January 2014, the Robeco fund’s investment cases need to include an assessment of how the most material ESG issues affect a company’s competitive position and target price. We can therefore systematically calculate the impact of ESG analysis on the portfolio.
In many countries, productivity growth has considerably declined in recent years. According to Peter van der Welle, strategist at Robeco, there is no cause for alarm. Thanks to the power of 'creative destruction', productivity growth will return to the usual level.
Interest in factor investing – investing in systematic sources of return – is rapidly increasing. Up to now most investor interest in this area has been focused on equities. But what are the possibilities for applying it to credits?
Robeco brings factor investing to credit markets, launching the Robeco Global Multi-Factor Credits fund on June 15, 2015. This credit fund allows investors to benefit from factor investing, which has been so successful in equity markets over the past years.
The case for financial bonds is more compelling than ever. Having learned some lessons in the Great Financial Crisis of 2007-2008, banks and insurance companies have been tidying up their balance sheets. While new regulations such as Basel III require new types of bonds to be issued that offer attractive yields, increased supervision and regulation will substantially lower the risk of default.
It’s easy to claim that sustainability is important. But it’s a lot harder to show it is, let alone quantify and monetize it. Willem Schramade, Sustainability and Valuation Specialist in Robeco’s Global Equity team, outlines the problems and the solutions to them.
Spain is in recovery mode, but has not been rewarded for this by equity investors so far in 2015. What is the outlook for the rest of the year? Robeco’s Chief Economist Léon Cornelissen explains why he is optimistic.
Conduct and litigation issues are a widespread phenomenon in the financial sector and because of the sheer size of the fines, they can have a material impact on a company’s ability to pay back its debt. We think that, despite recent improvements, these issues are here to stay for at least several years to come. Consequently, we spend much time analyzing related ESG factors to account for this risk in our credit investment decisions.
Trading is necessary to follow an active strategy, but excessive trading is linked to human behavior. In his new paper just published on SSRN Pim van Vliet looked into why investors trade and how much trading is needed for an effective low-volatility strategy.
David Pitt-Watson is Executive Fellow of Finance at the London Business School, and chairman of the United Nations Environment Programme Finance Initiative (UNEPFI). He is a former chairman of Hermes Focus Funds. In this Q&A, he addresses how sustainability investors can make have a huge influence on climate change policies.
Sustainable investment is growing rapidly. Although it has been growing fastest in the US over the past two years, Europe remains the undisputed leader, says Nicolas Bénéton, Sustainability Investment Specialist for Robeco France.
Robeco Global Tactical Asset Allocation (GTAA) celebrates its fifth anniversary this month. And the icing on the birthday cake for investors has been a great track record, with consistent and considerable return in turbulent markets.
Europe has seen a modest pick-up in economic growth in the first quarter, with unexpectedly strong figures coming in from France and Italy. But the region still faces an environment characterized by low interest rates with low expected economic growth and low inflation. This environment resembles the scenario Japan faced in the 1990s. What are the lessons for investors in low-volatility European stocks?
Institutional investors are attaching increasing importance to the sustainability of their investments. Whereas in the equity space, this trend has been going on for years, in fixed income investments sustainability investing has only recently started to generate widespread interest.
While the spotlights are still on Greece – as an escalation in various forms could still occur any day – two other large southern European economies are, nearly unobserved, finally showing signs of recovery.
A paper* argues that size, value, momentum and other factor portfolios might be considered as alternative building blocks for strategic asset allocation, because these offer an attractive risk premium and powerful diversification benefits.
Brunel has won the seventh leg of the Volvo Ocean Race. After an exciting neck- and- neck race with Dongfeng and Mapfre, skipper Bouwe Bekking and his crew finally crossed the finish line in first place.
Accumulating a supplementary pension, investing for your children's education or saving to pay off your mortgage – all require specialist knowledge. How can you accumulate capital yourself without losing sight of the right risk-return mix?
A paper* argues that size, value, momentum and other factor portfolios might be considered as alternative building blocks for strategic asset allocation, because these offer an attractive risk premium and powerful diversification benefits.
Companies operating on the cutting edge where the banking and technology sectors meet are very much in the public eye. Patrick Lemmens, fund manager of Robeco New World Financial Equities, sees interesting opportunities, but warns that investors should not get too carried away.
As the boats of the Volvo Ocean Race are reaching the coast of the ‘new world’, the global financial sector is coming to grips with a brave new world of its own. Long-term trends are changing the core of the financial industry and investors can benefit. Patrick Lemmens, fund manager of Robeco New World Financial Equities, explains how he does it.
April turned out to be a month with limited positive news across the board. US, Japanese and Chinese economic data all disappointed, while European data – although broadly still better than expected – failed to impress as much as it did in the first quarter, as analysts raised the bar with respect to European growth expectations.
The Volvo Ocean Race competitors have arrived at the sixth stopover port in the United States after three weeks’ sailing from Brazil. Our new e-magazine focuses on the US and what is still the ‘New World’ for investing after the financial crisis. Read how both Robeco and Team Brunel watch which way the wind is blowing for thematic investing and sailing respectively; find out how it is still the ‘US century’; and discover the ‘Mast-er’ Plan’ for mending battered boats.
The growth in global consumption will be driven mainly by emerging markets in the coming decade. The OECD predicts growth in Asia of no less than 571 percent between now and 2030, predominantly on the back of strong growth in China, India and Indonesia. How can investors use this to their advantage?
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