Infrastructure stocks have been the one of the hardest hit sectors of the equity market over the past five months. It is our view that sentiment and not true fundamentals have caused much of this impact. But such sentiment is reversible given long-term fundamentals for infrastructure, with large investors now seeing multiples here at attractive valuations.
In this Q&A, Richard Elmslie, Co-Chief Investment Officer and Co-Chief Executive of RARE Infrastructure, explains the growth potential for infrastructure assets over the next decade and their resilience in the face of future downturns.
Q&A with Richard Elmslie
Richard Elmslie, Co-CEO of RARE Infrastructure provides insight on President Trump’s infrastructure plan, including the necessary incentives to attract private capital and the challenges that the Trump administration could face.
The RARE 200 is a proprietary investment universe used to select securities for the RARE Infrastructure Value Strategy. The companies chosen for the universe must have high levels of liquidity, quality, and what RARE believes constitutes core infrastructure.
More spend on airports, roads, rail and water is likely to flow from the Trump Administration’s infrastructure reform. The acquisition of publicly owned assets by listed infrastructure companies is another potential outcome.
Chart of the Week
Source: Bloomberg, April 19, 2018 Past performance is no guarantee of future results. Indexes are unmanaged, and not available for direct investment. Index returns do not include fees or sales charges. This information is provided for illustrative purposes only and does not reflect the performance of an actual investment.
Chart of the Week
OPEC’s meeting had some unexpected commentary; the Fed heard tales of good times; Bank of England surprised its markets.
Because they impact trade flows, tariffs have implications for port, road and rail systems. This could end up stimulating investment in new infrastructure capabilities.
Global Listed Infrastructure
Select emerging market (EM) companies are an increasingly attractive part of the global listed infrastructure universe. When added to a portfolio of developed market stocks, EM securities offer a greater source of income and differentiation in returns.
Investing in infrastructure can be one of the most direct ways of capturing emerging markets (EM) growth. With improved regulation and a growing amount of assets, EM companies are an increasingly attractive part of the global listed infrastructure universe. Charles Hamieh, Senior Investment Analyst and Portfolio Manager at RARE Infrastructure explains the scope of the sector.
The fortunes of individual global infrastructure companies will be driven by three key themes in the year ahead. Nick Langley and Richard Elmslie, Co-CEOs and Co-CIOs of RARE Infrastructure, explain the risk and opportunities to companies for each of these themes and give their general outlook for 2018.
Matt Bushby, RARE's Global Head of Distribution, explains their specialist view on infrastructure and the key infrastructure characteristics RARE looks for. He also examines why it can be limiting to view the infrastructure opportunity as the ‘Trump trade’.
All investments involve risk, including loss of principal. Past performance is no guarantee of future results. Please see each product’s webpage for specific details regarding investment objective, risks associated with hedge funds, alternative investments and other risks, performance and other important information. Review this information carefully before you make any investment decision.