Investing for the New Tomorrow

Progress is not possible without change and we have collectively witnessed perhaps some of the most profound transformations in history. Our jobs as stewards of capital have evolved. Fundamentally the process remains unchanged but the consumption and speed of data has required adjusting how we as managers tackle volumes of intelligence to garner superior judgement.

THE ROAD AHEAD

  • Forecasters suggest that by 2050 we will reach a global population of 10 Billion people! A growing population with limited resources – consider the critical need for investment in SUSTAINED DEVELOPMENT. It’s barely begun.
  • 250,000 people will retire in Canada in 2016 and that number will rise to 400,000 by 2024. Add the Davos projections re the impact of robotics and automation effects in the coming decade. Will this mean less tax revenues – consider the future of SOCIAL PROGRAMS/HEALTHCARE (How to plan? How to invest? Wealth transition? Estate Planning?)
  • The continuing saga of low interest rates, quantitative easing fallout and now the advent of NEGATIVE INTEREST RATES – How does one tackle the removal of a traditional defensive asset class? What is the definition of safe portfolio construction?
  • GLOBAL DISRUPTIONS – almost too many to list but they harken back to the Great Crash of 1987 and come with what now feels like too great a frequency. Great Recession of 2008-09, Brexit and is YOUR portfolio positioned for the U.S elections?

YOUR PATH FORWARD

It’s always easier getting where you want to be by looking out the windshield and not the rear view mirror. Exponent’s ability is not only identifying the obstacles that lie ahead but to change them into opportunities. Change will take on a different dynamic in the next 25 years and it will be driven by demographics, the need to protect the planet, its resources and the active ownershipof investors and Exponent clientele.

Sustainable development although given much play by governments, has instead already been embraced by private industry and consumers. Baby Boomers, Generations X&Y and even Millennials are becoming more engaged in how their portfolios are being engineered. Companies, their executives and boards are voted in or out based on decisions made like never before.  Our data collection is insightful in sorting through leaders who have already taken significant steps in the areas of the Environment, Social and Governance. Imagine owning well know proven mid and large capitalized global corporations with lower carbon exposure vis-a-vis the broad market?

Global disruption will continue given the linkages of markets and trading blocks. If one thing has taught sage Portfolio stewards in the last 25 years is that you tune out today and think about that tomorrow. Being able to adapt to the environment is paramount. With the integration of global financial markets, this has positioned Exponent to build a series of well diversified and resilient portfolios to not only grow capital and provide income but also not limit opportunities in an evolving world.

The coming shifts globally will have dramatic impacts on portfolio construction. Traditional portfolios will no doubt place limits on expected results.  A combination of shared beliefs both client and investment will improve the odds of a better outcome. Investing in knowledge now will yield future dividends.

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If you intuitively feel that changing your thinking will change your future, please call us for a no obligation strategic review and discussion.</sp

Graham Mayes

About Graham Mayes, CFP, TEP, MTI

Chief Investment Strategist & Partner

Graham’s role at Exponent includes direct portfolio management, investment analysis, asset oversight, allocation and portfolio engineering, SRI/ESG mandates and Charitable Foundations. Graham is a member of the CFA Institute and the CFA Society of Ottawa.

Learn More About Graham

Exponent Investment Management