Australia Wealth Fund To Have Home Bias, Trim Stock Holdings

The transcript discusses the challenges of managing a large and diverse portfolio like the Future Fund. It highlights the impact of COVID-19 and generational changes on investment strategies, emphasizing the need for new financial models. The discussion covers the shift towards more active and illiquid investment strategies due to lower expected returns and geopolitical risks. The conversation also addresses the challenges in public markets, the decline of traditional portfolio models, and the geopolitical tensions affecting emerging markets, particularly China.

What is the speaker's view on making assumptions about the global economy?

• Assumptions are crucial for planning.

• Assumptions are often incorrect.

• Assumptions are only useful in the short term.

• Assumptions should be avoided entirely.

How has the world fundamentally changed post-pandemic according to the speaker?

• A decrease in global fiscal stimulus.

• Increased reliance on traditional financial models.

• The rise of millennial and Gen Z influence.

• A shift towards more conservative fiscal policies.

What does the speaker suggest as a strategy to compensate for lower returns?

• Investing solely in public markets.

• Adopting more active and dynamic strategies.

• Avoiding illiquid investments.

• Focusing on passive investment strategies.

What is the speaker's perspective on the traditional 60/40 portfolio?

• It should focus more on bonds.

• It remains a viable strategy.

• It is no longer effective.

• It should be increased to 70/30.

Why is the Future Fund cautious about investing in China?

• Because of China's intervention in large companies.

• Due to China's low population growth.

• Because China is reducing its global trade.

• Due to China's economic growth.