Displaying items by tag: investors

While rising interest rates might make things difficult for life insurance company risk managers, they were great for individual fixed annuity sales in the fourth quarter of 2022. According to new issuer survey data from Wink, overall sales of all types of deferred contracts increased 30% between the fourth quarter of 2021 and the fourth quarter of 2022, to $79 billion. Sales of three types of products classified as fixed, traditional fixed annuities, non-variable indexed annuities, and multi-year guaranteed annuity (MYGA) contracts — climbed 102%, to $58 billion. Sheryl Moore, Wink’s CEO, told ThinkAdvisor that MYGA contracts in particular benefited both from increases in crediting rates and consumers’ fear of market volatility. She noted, “Eighteen percent of insurance companies offering MYGAs experienced at least triple-digit sales increases over the prior quarter.” In fact, MYGA contracts jumped 217% to $36 billion, non-variable indexed annuities rose 28% to $22 billion, and traditional fixed annuities increased 18% to $575 million. Wink based the latest annuity sales figures on data from 18 index-linked variable annuity issuers, 48 variable annuity issuers, 51 traditional fixed annuity issuers, and 85 multi-year guaranteed annuity (MYGA) issuers.

Finsum:According to new issuer survey data from Wink, rising interest rates helped sales of all types of deferred contracts rise 30% year over year in the fourth quarter of 2022, to $79 billion.

While many ESG investors are drawn to the appeal of helping the environment with their investments, the two-year rally in oil and gas stocks has become too much to ignore. The energy sector has led the market for two years rising 135% in 2021 and 2022 compared with a 2.2% gain in the S&P 500 Index. Analysts expect the sector to jump another 22% in 2023, despite its 5.8% decline so far, according to data compiled by Bloomberg. ESG firms have taken notice. Rockefeller Capital Management takes pride in its ESG investing record. While the firm’s larger portfolio follows multiple strategies that include ESG and non-ESG, its $19 billion equity portfolio now has a 6% energy weighting. This is even more than the S&P 500’s energy weighting of 4.8%. Plus, clients in Rockefeller’s wealth management arm, which is separate from its asset management arm, have almost tripled their holdings in Chevron Corp. In fact, the stake’s value has quintupled to $251 million over two years. Their clients have also been buying tens of thousands of shares in Brazilian oil producer Petroleo Brasileiro SA, Diamond Offshore Drilling Inc., and several other S&P 500 Energy Index members, including Exxon Mobil Corp. and APA Corp.

Finsum:With a massive two-year run, and a strong return expected this year, energy stocks have attracted clients of firms such as Rockefeller Capital Management that take pride in their ESG investing record.

According to the third annual Alternatives Watch (AW) Research Investor Compendium commissioned by Vidrio Financial, there was a strong uptick in the amount of alternative investment mandate activity across some of the largest institutional investors. In 2021, AW's second annual compendium tracked a total of $130 billion in new capital across more than 900 individual institutional investor mandates from 50 of the top alternative allocators. That figure jumped to $144 billion in 2022, an increase of over 10%, across more than 1,000 individual mandates. There was also an increase in investor interest across infrastructure and real asset strategies to $6.9 billion and $4.9 billion, respectively, as those strategies act as inflation hedges. Other key findings include a muted slowdown in private equity assets, while there was a pick-up in activity in hedge funds as large institutional players sought to purchase risk-mitigating assets throughout the year. In addition, total private equity and venture capital mandates accounted for over half the mandates in the compendium and were spread out across the world, as investors embraced life sciences and technology sectors. Mazen Jabban, Chairman and CEO, of Vidrio Financial, stated, "As we saw in this year's Compendium performance data, Vidrio Financial continues to observe alternative asset classes growing in importance for institutional investment teams who work to take advantage of illiquidity premiums in the private markets while also seeking greater transparency into these types of investments."

Finsum:According to the third annual Alternatives Watch Research Investor Compendium, there was a 10% uptick in the amount of alternative investment mandate activity across some of the largest institutional investors.

Investors poured into U.S government bonds Monday after last week’s collapse of Silicon Valley Bank. This sent Treasury yields plunging. The 2-year Treasury yield was recently trading at 4.06%, down 100 basis points or a full percentage point, since Wednesday. This marks the largest three-day decline for the 2-yield since Oct. 22, 1987, when the yield fell 117 basis points. That move followed the October 19th, 1987 stock market crash, which is also known as “Black Monday.” The yield on the 10-year Treasury was down just under 20 basis points. Prices soared and yields fell after news of the collapse of Silicon Valley Bank. Regulators took over the bank on Friday after mass withdrawals on Thursday led to a bank run. Regulators announced on Sunday that they would guarantee Silicon Valley Bank’s depositors. With fears of contagion across the banking sector spiking, investors looked to government bonds for safety. Investors are also rethinking how aggressive the Federal Reserve will be with rate hikes after the bank’s collapse. This helped to send short-term yields lower. The Fed is meeting next week and was expected to raise rates for the ninth time since last March. However, Silicon Valley Bank’s collapse may change that. Goldman Sachs certainly thinks so. The investment bank no longer thinks the Fed will hike rates, citing “recent stress” in the financial sector.

Finsum:After Silicon Valley Bank’s recent collapse, fears of contagion across the banking sector spread, driving investors into Treasury bonds, which sent yields tumbling.

According to a report by Nationwide, women investors are getting more uneasy about their retirement prospects as market volatility continues and inflation remains a concern. Nationwide’s eighth annual “Advisor Authority” study, which is sponsored by its Nationwide Retirement Institute, found that more than 40% of women believe the U.S. is in a financial crisis, with another 24% believing that one is looming. Women are also feeling discouraged about retirement preparedness as the report found that nearly nine in 10 women (87%) said that no matter what they do to manage their finances, they still feel blindsided by events outside their control. That marks a double-digit percentage point increase over last year as only 76% voiced that sentiment in 2022. Nationwide also noted that more than half of non-retired women investors (54%) believe that inflation poses the most immediate challenge to their retirement. Thirty-eight percent also cited economic recession as a disruptor, while 21% pointed to market volatility. The “Advisor Authority” research was conducted online within the U.S. by the Harris Poll on behalf of Nationwide in January. The survey included 511 advisors and financial professionals and 789 investors aged 18 or over with investable assets of more than $10,000.

Finsum:According to Nationwide’s eighth annual “Advisor Authority” study, women investors are more uneasy about their retirement portfolios as market volatility, inflation, and a potential economic recession remain a concern.