SOHN Hearts and Minds Investment Leaders Conference in Sydney
17 November 2017
The Future Fund Chief Investment Officer, Raphael Arndt, recently spoke at the SOHN Hearts and Minds Investment Leaders Conference in Sydney. The SOHN Conference was established to raise money for medical research, and the event on 17 November 2017 raised close to $3.5 million.
Speakers on the day included Prime Minister Malcolm Turnbull, New South Wales Premier Gladys Berejiklian, former Prime Minister Paul Keating and other fund managers.
Raphael’s presentation explained that we are living in a time of intense change, with five key megatrends contributing to this change.
- End of the leverage tailwind – asset price growth driven by increased leverage is not sustainable;
- Slowing population growth will reduce future economic growth;
- Populism and populist policies are increasing, and are being driven by the concern of many people in developed countries who have experienced little income growth in two decades. Populist policies will reduce future economic growth;
- Generational change and changes in consumer preferences mean great investment ideas of the last 50 years may not be the winners of the next 50; and
- Changes in technology occur quickly. WeChat passed 500 million users within four years of operation, and is now approaching 1 billion users. Investments can become worthless very quickly if they can’t adapt and as a result get disrupted by new technologies or competitors.
The key message is that the future will be different to the past we have experienced over the last 30 years and the Future Fund is responding to this by maintaining a flexible portfolio that can respond and adapt as conditions change.