Macquarie is a recognised leader in real assets1
Dedicated multi-asset specialists supported by 60 listed real assets investment professionals
- Differentiated investment process with a dynamic asset-allocation framework
1. IPE Real Assets Top 100 Infrastructure Investment Managers 2023, published in July/August 2023. Macquarie Group’s investments in infrastructure are predominantly by Macquarie Asset Management’s private market’s infrastructure team, which acquires and manages infrastructure and infrastructure-like businesses on behalf of investors.
We invest in assets with links to general inflation and in sectors where supply and demand dynamics are expected to lead to structural demand for tangible assets. Our objective is to protect purchasing power and provide inflation-adjusted total return over full market cycles with strong relative performance against broad equity and fixed income markets, particularly during inflationary environments.
A multi-asset, multi-sleeve, customisable portfolio solution:
- Dynamic multi-asset allocation framework focused on realising relative value opportunities
- Top-down asset allocation determined by the Global Multi-Asset team led by CIO and Portfolio Manager Stefan Löwenthal
- Bottom-up security selection determined by Macquarie sector specialists
Market assessment
- Global real assets are tangible, long-lasting physical assets. These assets typically include natural resources, commodities, infrastructure, real estate securities, and inflation-linked bonds.
- Global demographic and secular trends, such as urbanisation, a growing workforce, infrastructure renewal, and sustainable development, are driving significant demand for real assets.
- Real assets are a fast growing yet under-researched segment of the market.
Pairwise views
- Our foundation for asset class ranking is pairwise analysis, which compares two assets head to head and makes a call about which of them will outperform.
- This analysis aims to predict the relative value of each asset within the pair. Ultimately, each pair’s signal becomes an input in our portfolio construction process.
- Advantages include:
- Focus on directional views rather than, in our view, error-prone point return forecasting
- An ordered and rigorous decision-making process
- Less sensitivity to behavioural biases
Portfolio construction
- To determine the optimal asset mix, we combine our pairwise views with a stringent risk management framework
- Each asset class is ranked on a risk-adjusted basis to achieve the maximum portfolio utility
- Risk contributions and overall portfolio risk limits are embedded in portfolio construction to safeguard sound portfolio positioning
Environmental and social considerations
- Exclusion screen to identify companies which may harm environmental or social characteristics
- SDG alignment assessment, based on Macquarie Asset Management’s proprietary scoring process
- ESG integrated fundamental analysis assess both financial and non-financial criteria
For more information about our multi-asset capabilities
Risks
As a class, equities carry higher risks than bonds or money market instruments.
The Strategy focuses on a single sector (global listed real assets).
The value of an investment in the Strategy can go up and down. When you sell your shares, they may be worth less than you paid for them. If your currency as an investor is different from the reference currency of the Strategy, changes in currency exchange rates could reduce any investment gains or increase any investment losses.
International investments entail risks including fluctuation in currency values, differences in accounting principles, or economic or political instability. Investing in emerging markets can be riskier than investing in established foreign markets due to increased volatility, lower trading volume, and higher risk of market closures. In many emerging markets, there is substantially less publicly available information and the available information may be incomplete or misleading. Legal claims are generally more difficult to pursue.
Preferred stock and hybrid securities and the risks associated with both, including distribution deferrals, liquidity, voting rights and redemption by the issuer could impact the Strategy.
Certain derivatives could increase the Strategy’s volatility or expose the Strategy to losses greater than the cost of the derivatives.
Certain securities could become hard to value, or to sell at a desired time and price.
A foreign government or government-related issuer may be unable to make timely payments on its external debt obligations.
IBOR risk is the risk that changes related to the use of the London interbank offered rate (LIBOR) or similar rates (such as EONIA) could have adverse impacts on financial instruments that reference these rates. The abandonment of these rates and transition to alternative rates could affect the value and liquidity of instruments that reference them and could affect investment strategy performance.
The Strategy’s investment in energy infrastructure master limited partnerships (MLPs) is subject to a variety of industry specific risk factors that may adversely affect their business or operations, including those due to commodity production, volumes, commodity prices, weather conditions and terrorist attacks, as well significant federal, state and local government regulation and potential tax consequences for shareholders.
Active management will increase the expenses of the Strategy because of brokerage charges, spreads, or mark-up charges. Active trading could raise transaction costs, thereby lowering the Strategy’s returns, and could generate taxes for shareholders on realized investment gains.
The disruptions caused by natural disasters, pandemics, or similar events could prevent the Strategy from executing advantageous investment decisions in a timely manner and could negatively impact the Strategy’s ability to achieve its investment objective and the value of the Strategy’s investment.
[3119285]