The week in investor relations: Sustainable funds, volatility and cash levels
– The Financial Times (paywall) reported that six out of 10 sustainable funds outperformed their conventional fund equivalents over the last 10 years. The study was conducted by Morningstar and used a sample of 745 sustainable funds based in Europe.
– The disruption to traditional AGMs caused by Covid-19 could be a starting point for reform of the shareholder meeting, noted the FT. ShareAction, an investor group, is raising money to investigate how AGMs could change and would like to see a system with more involvement given to stakeholders beyond shareholders.
– The utilities sector saw more volatility than the broader market during March and April, according to the Wall Street Journal (paywall). Normally, utilities stocks are viewed as relatively safe havens during times of market stress. Over those two months, however, the sector ‘posted bigger daily moves than the S&P 500 on a majority of days,’ noted the article.
– Instagram is expected to become a more important news source than Twitter, according to the BBC. Since 2018, the proportion of people using Instagram for news has doubled, noted the article, citing the 2020 Reuters Institute Digital News Report. Social media, however, is viewed as an unreliable news source by the majority of respondents.
– The chairman of the FASB wants US companies to provide as much transparency as possible on government support they have received during the pandemic, reported the WSJ. Russell Golden said financial statements should explain what has been received and when support might end.
– The share price of Wirecard collapsed by 40 percent after the German company said its auditor could not confirm the existence of €1.9 bn ($2.1 bn) in cash, reported Reuters. Markus Braun, CEO of Wirecard, said the company could be the victim of fraud. Since last year, media reports have questioned the validity of Wirecard’s finances, allegations the company has rejected.
– Investors lowered cash levels in June to chase the stock market rally, reported Bloomberg, citing Bank of America’s monthly fund manager survey. The poll took place between June 4 and June 11, a time that included a sharp fall in the S&P 500. Hedge funds were among those moving into stocks, upping their exposure to its highest level for nearly two years.
– The issue of Brexit is once again becoming a major focus for investors, reported Pensions and Investments. Tensions are set to rise as the UK and European Union search for a deal that would avoid a hard Brexit. ‘It has come with the other big theme of 2019: US-China tensions are also coming back,’ said a senior economist at Amundi.
And to recap, here are IR Magazine’s stories posted this week:
– Virtual IPOs: Temporary or definitive solution?
– Navigating phase two of Covid-19: Three IR tips for CFOs (sponsored content)
– Covid-19 report now available
– Two thirds of FTSE 100 mention TCFD in reporting, finds research
– ‘You’re on mute’: The data behind virtual earnings call mishaps
– Covid-19 set to reshape major stock market indexes
– Fund manager profile: ING Private Portfolio Management
– Are emerging markets indices losing weight?