KKR Releases “Another Swing at the Plate”
New Report Provides Further Insights on
“Given the current state of affairs around the world these days, we are not totally surprised by the questions we’ve received, as investors consider where to deploy and harvest capital in today’s unsettled environment. What has been surprising, though, is how concentrated the questions have been around a few key topics. So, in response, we are taking another “Swing at the Plate,”
In Another Swing at the Plate, the GMAA team posits the following:
|1.||In terms of ongoing trade tensions, China’s desire to internalize its economy has been a long-standing goal that accelerated after the Global Financial Crisis, long predating the election of President Donald J. Trump.|
|2.||Despite the heightened geopolitical tensions throughout Europe, significant investment opportunities exist, particularly within private investments that offer alpha for capital allocators who are willing to take more of a top down approach to deployment in the region than they might typically otherwise do. As part of this analysis, sound portfolio construction in Europe is becoming a differentiating feature, given intensifying macro headwinds.|
|3.||There are several structural forces at work that require investor attention when it comes to assessing the future role of sovereign debt in portfolios. Consistent with this view, we think that we are at an inflection point in the U.S. fixed income markets, one that argues for buying shorter duration cash flowing assets linked to nominal GDP and decreasing exposure to longer duration sovereign debt.|
|4.||Given our call for lower overall returns with greater dispersion of outcomes, we believe that having the flexibility to invest across asset classes during periods of dislocation is becoming increasingly important across both public and private markets.|
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KKR is a leading global investment firm that manages multiple alternative asset classes, including private equity, energy, infrastructure, real estate and credit, with strategic partners that manage hedge funds. KKR aims to generate attractive investment returns for its fund investors by following a patient and disciplined investment approach, employing world-class people, and driving growth and value creation with KKR portfolio companies. KKR invests its own capital alongside the capital it manages for fund investors and provides financing solutions and investment opportunities through its capital markets business. References to KKR's investments may include the activities of its sponsored funds. For additional information about
The views expressed in the report and summarized herein are the personal views of
Kristi Huller or Cara Major