Showing 21 - 30 of 247 entries
MSCI BlogBridging the gap: Adding factors to indexed and active allocations
How can asset owners integrate an equity factor allocation into their existing roster of active managers? There is no one answer that suits all. The response may be different for each asset owner, depending on its investment beliefs, goals and risk tolerance.
Research PaperBridging the gap: Adding factors to indexed and active allocations
Asset owners face a challenge in determining how the factor allocation fits into the overall equity program, in particular how the factor allocation relates to the existing roster of active managers. This paper uses a risk budgeting framework to investigate how active mandates and factor allocations can be combined. We address three key questions: 1) how does the level of active risk in active management affect the factor allocation decision, 2) what share of the portfolio can be deployed to...
MSCI BlogCEO Pay: Trick or Treat?
Some large asset owners are increasingly coming to believe that many executive pay schemes don’t align the interests of CEOs and investors. There appears to be an increasing focus on pay plan simplicity and transparency.
Research PaperFoundations of ESG Investing – Part 3: Integrating ESG into Indexed Institutional Portfolios
According to recent surveys, asset owners’ have shifted their main focus to ESG’s financial benefits, as opposed to social benefits. In the third part of this paper, we discuss how ESG can be integrated into indexed allocations using MSCI ESG Ratings, which provided better risk-adjusted returns from August 2010 to December 2017 than the MSCI ACWI Index. We used existing best-in-class selection-based index methodologies (the MSCI ESG Leaders Index) for the creation of hypothetical global and...
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MSCI BlogHow Funds Are Positioned for a Low-Carbon Future
As the world moves toward a low-carbon future, companies of many stripes are adopting renewable and clean-energy technologies. That, of course, has implications for stocks and the portfolios that hold them. How can asset owners understand the carbon-transition risks in their portfolios?
MSCI BlogAdam Smith’s “invisible hand” and the value of benchmarks
Today, there are indexes designed to represent the performance of a wide range of investment segments, including market capitalization, geography, industry and, most recently, factors. They also are used as the basis for financial products, such as exchange-traded funds or derivatives. Much like Adam Smith’s “invisible hand,” they play a critical, behind-the-scenes role, reflecting the entire market’s views on valuations, rather than those of any individual or group of individuals.
MSCI BlogThe road toward a seamless global real estate portfolio
Two roads lead asset owners into real estate: the private (direct and indirect) ownership route and the public equity route. With private assets, investors can analyze performance in detail, down to the asset and vehicle level.
MSCI BlogUsing factors in international investing
Over the last decade, asset owners have implemented factor investment programs with a focus on domestic markets. Increasingly, they are also funding equity factor programs in international markets. Two catalysts are driving this trend. First, there has been a steady erosion in asset owners’ home biases, leading to more indexed and active international mandates. Second, investment committees and boards of trustees have become more comfortable with using factors as a complement to core indexed and traditional active allocations.
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