The CFA Institute European Investment Conference is a focused, interactive conference for Europe’s leading investment professionals. The 2017 CFA Institute European Investment Conference will bring portfolio managers, analysts, chief investment officers, and CEOs together in Berlin on 16–17 November.
In the aftermath of the Global Financial Crisis, central banks have pursued near-zero interest rate policies, followed by zero interest rate policies, arriving at negative interest rate policies in some countries. As rates continue their descent, their distortionary effect on expected returns has grown more pronounced, presenting investment managers with a difficult set of decisions.
A column in the Wall Street Journal noted that central banks’ interest rate policies have made everything more expensive than it looks. The column quotes Antti Ilmanen, a principal at AQR Capital Management, who says that “everything is expensive because this thing at the heart of the system has gone to all-time lows.” Lower interest rates make it difficult to determine the intrinsic value of an investment, which increases the risk that investment managers will pay too much for their investment returns. Read More