Private assets views Q2 2023 - Navigating the downturn
Since October last year, our view has been that there is a high probability of a recession occurring in 2023. That remains the case.
Recent events, such as the failures of Silicon Valley Bank and Credit Suisse, have reinforced our outlook. We also note that after the significant bankruptcies during the recessions of 2001 and 2008, it took an additional year for equity markets to hit bottom. Therefore, we believe that the recent banking failures may not necessarily indicate the end of the current economic downturn.
We believe that recessions can create attractive investment opportunities for private assets. Historical data suggests that recession vintage years have often produced favourable results for private assets.
In the current economic climate, we recommend that investors direct their new investments towards assets that align with long-term trends and exhibit low correlation with traditional investment strategies.
Additionally, investors could consider cyclical or contrarian investment opportunities for tactical adjustments to their asset allocation, while avoiding investments that may be exposed to cyclical headwinds.
This site is for informational purposes and does not constitute an offer to sell or a solicitation of an offer to buy any security which may be referenced herein. This site is solely intended for use by institutional investors and institutional-investment industry consultants.
Schroder Investment Management North America Inc. (“SIMNA”) is an SEC registered investment adviser, CRD Number 105820, providing asset management products and services to clients in the US and registered as a Portfolio Manager with the securities regulatory authorities in Canada. Schroder Fund Advisors LLC (“SFA”) is a wholly-owned subsidiary of SIMNA Inc. and is registered as a limited purpose broker-dealer with FINRA and as an Exempt Market Dealer with the securities regulatory authorities in Canada. SFA markets certain investment vehicles for which other Schroders entities are investment advisers.
Schroders Capital is the private markets investment division of Schroders plc. Schroders Capital Management (US) Inc. (‘Schroders Capital US’) is registered as an investment adviser with the US Securities and Exchange Commission (SEC).It provides asset management products and services to clients in the United States and Canada.For more information, visit www.schroderscapital.com
SIMNA, SFA and Schroders Capital are wholly owned subsidiaries of Schroders plc.
