Long Run Returns Monitor (Mar. 2021)

In this first edition of the Long Run Returns Monitor we present an updated version of the projected returns from the major asset classes which feature in our annual Long Run Asset Allocation Outlook. While rising bond yields have put pressure on the prices of “risky” and “safe” assets alike in the weeks since the publication of that document, the moves in most markets have not been all that dramatic in the grand scheme of things. As a result, our view that the returns from most “risky” assets will be good rather than stellar – but still comfortably beat those from “safe” ones – over the next decade or so is little changed. Two asset classes which have bucked the trend by performing quite well in recent weeks are energy commodities and industrial metals. The further run-up in their prices means that our already pessimistic projections for returns from them over the next ten years are now even more downbeat.
Justin Chaloner Senior Economist
Continue reading

More from The Long Run

Long Run Returns Monitor

Long Run Returns Monitor (Oct.)

Our monthly Long Run Returns Monitor provides our updated long-term projected returns for major asset classes, as well as a summary of the macroeconomic forecasts which underpin them. All projections in this publication are as of 22nd October 2021. A more detailed explanation of our views can be found in our annual Long Run Economic Outlook and Long Run Asset Allocation Outlook.

22 October 2021

Long Run Update

The implications of accelerated renewable electricity use

Accelerated adoption of renewable electricity will cause demand and prices of coal and natural gas to fall over the long run. While we think the global economy will handle this transition well, there will be some winners and losers depending on which commodities countries import or export.

15 October 2021

Long Run Returns Monitor

Long Run Returns Monitor (Sep.)

Our monthly Long Run Returns Monitor provides our updated long-term projected returns for major asset classes, as well as a summary of the macroeconomic forecasts which underpin them. All projections in this publication are as of 27th September 2021. A more detailed explanation of our views can be found in our annual Long Run Economic Outlook and Long Run Asset Allocation Outlook.

29 September 2021

More from Justin Chaloner

Long Run Update

Higher female participation to help India outperform

There is typically more scope for female participation rates to rise and boost labour supply in EMs. This is particularly so in India and is one reason why we expect its economy to outperform in the long run.

19 May 2021

Long Run Update

China & US censuses: don’t count on catch-up

The 2020 US and China censuses add to the reasons why we think China will struggle to overtake the US as the world’s largest economy. China’s birth rate has continued to fall and the population will peak earlier than previously thought, so demographics will become an even larger drag on GDP growth.

11 May 2021

Long Run Focus

Accelerated technology use will improve productivity

There is evidence that the pandemic has accelerated technology use, partly through increased equipment investment but mainly through a change in the way that people work. The effects on productivity might not be immediate or huge, but they will be positive. And perhaps the most important point is that the pandemic seems to have altered attitudes towards technology, making future adoption more likely. This supports our optimism about the long-run prospects for productivity growth in developed economies.

16 April 2021
↑ Back to top