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Can gold be considered a ‚safe haven‘ investment?

On behalf of our clients, onValues has recently assessed the role of gold as part of a long-term investment strategy. Results of our analysis using price data for the last 20 years indicate that gold (measured in US-Dollars) did not outperform other ‘safe haven’ assets such as high quality government bonds in periods of pronounced stock market volatility. For non-US investors a volatile and generally weakening US-Dollar introduced exchange rate risks, frequently wiping out the occasional gains of gold holdings. We therefore cannot validate the common belief that gold is a good portfolio insurance based on recent history – especially for European investors. Moreover, the environmental and social impact of the gold industry needs to be taken into account. In extreme crisis situations, such as a global war or the collapse of global financial systems, gold could play a role as a store of value. For clients attaching a high likelihood to such events it could make sense to hold significant amounts of gold, but this would require a well thought through implementation plan, factoring in choices like physical denomination (coins, bars, jewellery), storage location (bank, external storage, at home) and security aspects when accessing and using the gold during crisis times.

New Toniic reports help investors navigate impact investment markets

Toniic Institute, the global action community for impact investors, has recently released “T100: Insights from the Frontier of Impact Investing”, a study showing aggregated data from 51 high net worth individuals, foundations, and family offices (including onValues clients). The data analyzed reveals that 100% values alignment can be achieved today in the portfolios of different types of investors, including those seeking market-rate returns. As part of the T100 project, Toniic also announced the launch of the Toniic Diirectory, a publicly accessible, peer-sourced catalogue of more than 1’000 impact investments made by its members, upon which the T100 findings are based. The directory is searchable by impact categories, impact themes, asset classes, management structure, liquidity profile, and impact geography.

Toniic also recently launched “T100: Insights from Impact Advisors and Consultants 2017” which shows the global landscape of dedicated impact investment consultants and advisors. 37 organisations from 12 countries, who work for 38 of Toniic’s members, open the door to their impact practices to demystify, inspire and activate both investors and the financial services industry. “What we see is a dedicated, articulate, optimistic, innovative, and definitely persistent group of entrepreneurial founders as well as large company intrapreneurs,” said Lisa Kleissner, co-founder of Toniic and its 100% Impact Network. “Beyond fulfilling their clients’ impact needs, they are building new impact products and services, and volunteering their time to strengthen and grow the impact ecosystem. All of them, while cognizant of the challenges, are optimistic there are solutions and a bright future for impact.”

Currencies as part of a long-term investment strategy

Defining and managing a global portfolio’s currency allocation is a key factor in driving long-term risks and returns. In our consulting practice we often find that our clients (and the banks and asset managers that advise them) do not pay enough attention to currency exposures or, alternatively, focus too much on short-term considerations and market timing of exchange rates. onValues does not believe in short-term market timing and supports clients in defining a global currency allocation that is in line with their risk/return profile and is part of a truly long-term investment strategy. As an input, we use different approaches based on long-term scenarios and macro-economic indicators. We are critical of commonly used approaches based on currency allocations of global benchmarks such as MSCI’s World or All Country World indices, given the fact that many global corporations generate more revenues abroad than in their home country. In addition, onValues provides an ongoing monitoring of currency markets informing clients of likely major market dislocations. This, in turn, is an input for revising the client’s long-term currency strategy or for measures aimed at reducing downside risk.

Investing in sustainable agriculture and food

In the past months onValues has increased its research activities focusing on investments in sustainable agriculture and food systems, also based on the interest that its clients are showing for this sector. From a financial point of view, investments in agriculture are interesting because of their real assets and yield generating character. From a social and environmental point of view, investments that take positive impact and ESG into account can contribute to food security and healthy nutrition, and reduce risks related to the use of pesticides and GMOs, to water availability, biodiversity loss and climate change. In identifying and assessing investments in the space, onValues can rely on its 15-year track-record and on a network of independent specialists. In the past, onValues has facilitated investor initiatives (see the Geneva conference in 2011 and the Principles for Responsible Investment in Farmland) and published proprietary research on the subject.

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News

  • Can gold be considered a ‚safe haven‘ investment?

    Read more

  • New Toniic reports help investors navigate impact investment markets

    Read more

  • Currencies as part of a long-term investment strategy

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  • Investing in sustainable agriculture and food

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  • Can microfinance add value to a global portfolio?

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  • How the passion of high-net worth investors drives impact investing

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  • Challenging future financial return assumptions

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  • Swiss pension funds and responsible investment

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  • Rethinking wealth: how an Asian family office successfully aligned its investments to its mission

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  • Working with peers on best-practice advisory standards

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