The multi-asset funds best placed to weather central bank storms

Weather the central bank storms

Valentijn van Nieuwenhuijzen, head of multi-asset, and Jan Kvapil, portfolio specialist at NN Investment Partners, analyse what different types of multi-asset funds can offer investors in the current environment.

Since the global financial crisis, central banks around the world have lowered their key interest rates aggressively to prop up their economies. The resulting decline in government bond yields and improved economic outlook have provided tailwinds for fixed income, as well as equity investments within multi-asset portfolios. In the past five years, an investment in global equities based on the MSCI World index would have earned 12% annually. A portfolio of global government bonds would have returned 4.4% a year, based on the Barclays Global Treasury TR index hedged to the euro. Strong ...