News category: Magazine

Jane Karczewski, a long-time investment banker, has this year joined Société Générale in London as the U.K. head of asset manager and hedge fund sales. She sat down with EQDerivatives’ Georgia Reynolds to discuss her new role, investor appetite in current market conditions and how the world of finance, and specifically derivatives, has changed and continues to change throughout her career.

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There was a time when these pages were filled with features on alternative risk premia. We wrote thousands of words about risk premia construction, implementation and backtesting. We wrote about benchmarking, tilting and timing, about bank-structured ARP and actively-managed risk premia. And of course, we wrote about the holy grail: the all-weather risk premia portfolio.

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Sustainability is an integral part of The Seventh Swedish National Pension Fund’s investment strategy. By investing in climate solutions and using active ownership to encourage companies toward net-zero alignment, the Swedish pension fund is dedicated to helping build a greener future. EQDerivatives’ Georgia Reynolds spoke to AP7’s Carl Fredrik Pollack about the pension’s latest direction — integrating climate transition strategies — the impact this will have on the fund, performance and the future.

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The volatility exchange traded product universe has increased in assets under management with the launch of multiple volatility-tracking products released throughout this year. These announcements may be a bright spot for the vol space in terms of innovation but doubts remain from traders and analysts who still have a vivid memory of the liquidation of VelocityShares’ inverse exchange traded note, XIV. EQDerivatives’ Dallon Lewis spoke with vol experts about the future of the volatility product landscape.

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Corporate responsibility is nowadays an integral part of the core activities of an institutional investor. The traditional method of implementing responsibility into the investment process has been negative screening, for example the exclusion of the non-responsible companies. Kari Vatanen, chief investment officer at Veritas Pension Insurance Company in Helsinki, discusses how the war in Ukraine has changed investors’ attitudes towards blacklists as a tool of responsible investing.

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The Cboe Volatility Index is broken, the headlines claim. But for long volatility funds, the breakdown in the historical relationship between implied volatility and equity prices means more than a “broken” index. It means a hard slog to make money and convince investors the strategy still works.

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Trend-following strategies have historically proved valuable in a downturn. Their robust performance over events like the dotcom bubble burst and the global financial crisis have made them a key component in asset allocators’ toolkits. But this year, for the first time in the last 30 years, investor sentiment has largely been dominated by concerns over rising inflation and the prospect of faster-than-expected central bank tightening. Can trend strategies maintain their value in the inflation-driven environment? EQDerivatives’ Georgia Reynolds reports.

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On the cover this quarter is The Seventh Swedish National Pension Fund’s Carl Fredrik Pollack. Pollack talked to EQD’s Georgia Reynolds about the fund’s active approach to climate transition and how AP7 hopes to effect real-world change.

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Officials at the Third Swedish National Pension Fund are developing a quantitative investment strategy mandate to manage the pension’s risk. EQDerivatives’ Georgia Reynolds sat down with AP3’s Claudia Stanghellini and Elena Westerdahl on the sidelines of Europe EQD at the Hotel Arts in Barcelona in May, to discuss the pension’s investment set up and the plan to become more active in quantitative investment strategies.

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It is perhaps not surprising that investors are paying more attention to the benefits of long volatility and fine tuning their risk mitigation efforts, given the market turbulence over recent years and the ongoing concerns over the long-term impact of the pandemic, as well as rising inflation and geopolitical uncertainties.

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