Risk mitigation, portfolio construction and alpha seeking

It is no longer fun to be a macro strategist, or is it? Central banks manage government and corporate bond prices and the negative impacts of corporate and economic fundamentals muted by liquidity and asset backstops. With these in mind, how are asset owners positioning their portfolios given the schism between the markets and the economy?

Panayiotis Lambropoulos, portfolio manager, hedge funds, emerging managers, opportunistic credit, Employees Retirement System of Texas
Moderator: Alex Proimos, head of institutional content, Investment Magazine

Key Takeaways

  • The ERS Texas has a preference for asset backed securities, directional growth, opportunistic credit and support for its own emerging manager program within its absolute returns strategies.
  • The role of absolute returns strategies is increasing given the diminished characteristics of fixed income as a hedge against equity risk, albeit ERS Texas does not deploy a traditional 60/40 model.
  • The remit of the fund is to consider all global opportunities with no particular emphasis on domestic assets and employment connotations.

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