eVestment examines how 10 investment consultants adjusted capital market assumptions across equities, fixed income, and alternatives during 2016 and 2017. Emerging markets equities carried the highest expected returns, while hedge fund outlooks lagged equities and consultant spreads on emerging market debt exceeded 200 basis points.
Capital Market Assumptions: 10 Consultant Outlooks
eVestment
Research
26 Pages
Key Takeaways
Emerging Markets Dominance: Across all consultants in 2017, emerging markets equity delivered either the highest or second highest expected equity returns, with spreads reaching 390 basis points above U.S. large cap assumptions.
Debt Dispersion Widens: Emerging markets debt showed the widest fixed income disagreement in both years, with consultant return assumptions differing by 225 basis points in 2016 and 220 basis points in 2017.
Private Equity Reset: Wilshire was the only consultant to raise private equity intermediate term assumptions in 2017, while several firms simultaneously reduced high yield forecasts by 50 basis points or more.
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