A robust approach to investing in an uncertain world

november 2016
We need a decision process that helps us to make the "unthinkable" thinkable

Ten years ago many of us were struggling with the "unthinkable" Japanese scenario of lower interest rates for longer. What if the same would happen in Europe? Most of us faced problems integrating this very unlikely possibility in a strategic decision process dominated by traditional Asset Liability Modelling (ALM). Today, we know that what was "unthinkable" back then became reality. Going forwards, we need a better decision process that helps us to make the "unthinkable" thinkable. In this article we will outline a multi-disciplinary factor approach that will help trustees to better understand the consequences of different "unthinkable" economic scenarios and help investment professionals to manage the portfolio in more robust way.

 VBA Opinie, Stefan Lundbergh en Mark Petit