KKR Releases “Diverging Paths” by Henry H. McVey
March 08 2018 - 7:00AM
Business Wire
New Macro Outlook Piece Highlights
Investment Shift Away from U.S. and Increased Confidence in Europe
and Asia
KKR today announced the release of a new macro Insights piece by
Henry McVey, Head of Global Macro and Asset Allocation (GMAA). In
Diverging Paths, McVey and his team outline the many compelling
opportunities in global asset allocation that they are seeing
abroad.
“While many of the conversations we are having with investors in
the U.S. these days are championing the merits of more U.S.-centric
strategies, this approach does not seem to dovetail well with the
way we are seeing the world in terms of asset allocation,” Henry
McVey said. “To be sure, we believe that the recent tax cuts are
constructive for the positioning of U.S. corporations and we fully
appreciate that sentiment across both consumers and executives in
the U.S. toward the future is booming. Nonetheless, as we position
our portfolio for the later stages of the economic recovery, our
shift in relative value is weighted towards non-U.S. assets.”
In his latest report, Henry McVey and his team share the
following insights from recent trips to Europe and Asia that
support their geographical bet as well as asset allocation
preferences:
- Central bank policy is less hawkish
outside of the U.S. (e.g. Japan and Europe), which makes it easier
to lock in low-cost liabilities – a key macro priority for us in
2018.
- Corporations in both Europe and Asia
are benefitting more directly from our belief that China has
already crashed in nominal terms.
- Our quantitative models for both
European growth and Emerging Market Public Equity outperformance
both suggest favorable outcomes for investors.
- Both Europe and Asia have emerged as
elegant plays on two of our most important macro themes:
‘Deconglomeratization’ and ‘Experiences over Things.’
- In addition, we see the fixed income
‘Illiquidity Premium,’ particularly in overseas markets, as a
compelling feature to earn solid risk-adjusted returns in today’s
low interest rate environment.
Links to access this report as well as an archive of Henry
McVey's previous publications follow:
- To read the latest Insights: click
here.
- To download a PDF version: click
here.
- To download the KKR Insights app for
iOS click here, and for Android click here.
- For an archive of previous publications
please visit www.KKRinsights.com.
About Henry McVey
Henry H. McVey joined KKR in 2011 and is Head of the Global
Macro and Asset Allocation team. Mr. McVey also serves as Chief
Investment Officer for the Firm’s Balance Sheet and oversees
Firmwide Risk at KKR. Prior to joining KKR, Mr. McVey was a
managing director, lead portfolio manager and head of global macro
and asset allocation at Morgan Stanley Investment Management
(MSIM). Prior to that he was a portfolio manager at Fortress
Investment Group and chief U.S. investment strategist for Morgan
Stanley. While at Morgan Stanley, Mr. McVey was also a member of
the asset allocation committee and was the top-ranked asset
management and brokerage analyst by Institutional Investor for four
consecutive years before becoming the firm's strategist in January
2004. He earned his B.A. from the University of Virginia and an
M.B.A. from the Wharton School of the University of Pennsylvania.
Mr. McVey is a member of the TEAK Fellowship Board of Trustees
after previously serving as co-chair of the board for five years.
Henry is also a member of the Pritzker Foundation Investment
Committee, a board member of the University of Virginia Investment
Management Company (UVIMCO), a member of the national advisory
board for the Jefferson Scholarship at the University of Virginia,
and a member of the Council on Foreign Relations Corporate Leader
Program.
About KKR
KKR is a leading global investment firm that manages multiple
alternative asset classes, including private equity, energy,
infrastructure, real estate and credit, with strategic manager
partnerships that manage hedge funds. KKR aims to generate
attractive investment returns for its fund investors by following a
patient and disciplined investment approach, employing world-class
people, and driving growth and value creation with KKR portfolio
companies. KKR invests its own capital alongside the capital it
manages for fund investors and provides financing solutions and
investment opportunities through its capital markets business.
References to KKR’s investments may include the activities of its
sponsored funds. For additional information about KKR & Co.
L.P. (NYSE: KKR), please visit KKR’s website at www.kkr.com and on
Twitter @KKR_Co.
The views expressed in the report and summarized herein are the
personal views of Henry McVey of KKR and do not necessarily reflect
the views of KKR or the strategies and products that KKR offers or
invests. This release contains projections or other forward-looking
statements, which are based on beliefs, assumptions and
expectations that may change as a result of many possible events or
factors. If a change occurs, actual results may vary materially
from those expressed in the forward-looking statements. All
forward-looking statements speak only as of the date such
statements are made, and neither KKR nor Mr. McVey assumes any duty
to update such statements except as required by law.
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version on businesswire.com: http://www.businesswire.com/news/home/20180308005323/en/
KKRKristi Huller or Cara Kleiman
Major212-750-8300media@kkr.com
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