The 2 asset classes ripe for thriving in the new market regime

Note: This Fund in Focus was taped on Thursday 7 November 2024.

Welcome to the new market regime—an era that will be more challenging for investors used to the free money punchbowl that has dominated markets for most of the last four decades. 

In the view of the world's largest and most influential asset manager BlackRock, this new regime will bring higher volatility, higher for longer inflation, more unpredictable macroeconomic conditions, and a new approach to portfolio construction. Gone are the days of the "set and forget" portfolio. Instead, investors would now be best served by innovative portfolio construction. In other words, the playbook of the last 40 years won't work now.

The end of the "set and forget" portfolio will also likely herald the end of the traditional 60% equities/40% bond and fixed income allocation approach. As 2022 demonstrated, it now pays investors to diversify into alternative assets.

Two of those alternative assets are infrastructure and real estate. According to Tamara Haban-Beer Stats, Director and ETFs and Index Investments Specialist at iShares by BlackRock, these two assets provide diversification, a lower correlation to equities, and a genuine income-earning opportunity.

But given how walled-off infrastructure and real estate investing has been in the past, how can you (the average investor) get access to this theme? If this is what you're after, look no further than this edition of Fund in Focus - discussing iShares' infrastructure product (ASX: GLIN) and its real estate product (ASX: GLPR).

ETF

iShares Core FTSE Global Infrastructure (AUD Hedged) ETF (GLIN)

Global Shares

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ETF

iShares Core FTSE Global Property Ex Australia (AUD Hedged) ETF (GLPR)

Global Shares

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Timecodes

• 0:00 - Intro
• 0:40 - Where does infrastructure investing fit in the "new market regime"?
• 1:48 - Why should investors consider infrastructure and real estate allocation in their portfolios?
• 3:03 - Can you break down the opportunity set for us?
• 4:10 - What are the similarities between real estate and infrastructure? And what is one key difference?
• 5:22 - What flows have you been seeing for this ETP? What am I paying and what am I paying for?
• 7:04 - What economic themes does investing in this asset class tap into?
• 8:59 - Can investors expect distributions?

Building global infrastructure and property into your core can allow investors to capture potential growth opportunities and navigate market cycles.

Learn more about how to use Real Assets ETFs here.