COP29 advanced international carbon trading with key agreements. Mixed signals on the energy transition, however, affirm investors’ view of an uneven transformation, while investment to address climate-driven physical risk looks likely to continue apace.

When investors assess risk, they construct narratives around the data. Investment managers and asset allocators can look to the long history of market sell-offs for context, to better anticipate future drawdowns and prepare portfolios for what the future may hold.