WEALTH AND ASSET MANAGEMENT THOUGHT LEADERSHIP

Institutional and Wholesale portfolios performance in the COVID-stressed scenario

Flash update

08/04/2020

Abstract


The article provides an analysis of institutional investors and funds of funds UCITS portfolios as of end March 2020. The document aims at illustrate how investors’ portfolios are reacting to the recent collapse of the markets due to the outbreak of COVID-19

The results show that the severe downturn in the financial markets, driven by global equity losing -20%, has significantly affected the year to date performances of both institutional and funds of funds portfolios, thus nullifying the good returns obtained in 2019. 

All the segments have shown a severe decrease of their portfolios’ performances, due to the negative trend that involved every asset class. Even if the majority of asset managers have reduced – whenever possible – the exposure to equity and other risky assets, the measures implemented did not turn out to be as effective as investor would have desired. Even assets historically considered as safe-havens, like gold, did not fully hold out. Anyway, most investors still maintain a liquidity surplus that exceeds their cash necessity and this could lead to a future appreciable capability to average down investments.