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The ESG-labeled bond issuance has been significantly growing and is likely to persist, along with investor interest in this segment of the fixed income markets. What can responsible investors in this market expect in the year to come? Sustainable bonds should play an increasingly important role.

Investors rode the wave of strong equity returns in 2021. While public equity fueled impressive investment returns, private equity and venture capital performance took portfolios to the next level. Although there was a lot to celebrate with private capital funds, all was not rosy at the end of 2021, with two-thirds of IPOs trading below their IPO price. While the sell-off in equity markets in early 2022 dipped lower, the private equity allocations remain an important component of a diversified portfolio.

In this 12th annual survey, the focus was on the back office areas and internal fund operations. The results highlight other trends and key insights in the hedge fund industry: growth in assets and funds; an opportunity for smaller, newer managers; investors boosting their hedge fund allocations; how traditional hedge funds are coping with cryptocurrencies; and the fee models in a post-‘two and twenty’ world.

Overall, the results of the 2022 10-year capital market assumptions are mixed depending on the asset class when compared to last year’s assumptions as the global recovery gains traction. We see weaker equity market returns due to slowing growth rates and stretched valuations. Fixed income asset class returns will once again be extremely limited given how low global bond yields are today.

As outlined in the 2022 Capital Markets Assumptions, long-term return expectations for traditional assets remain muted. Alternative investment solutions may offer an opportunity to increase portfolio returns by taking advantage of the remarkable post-pandemic economic evolution in a targeted way through public and private markets.

The sustainable and impact investing industry continues to scale, affording investors an increased level of influence on public and private markets. The most pronounced investor opportunity is expected to be in climate change and the future of work, two areas with significant implications for investment portfolios and for society. The industry is likely to be on the cusp of even larger adoption in the year ahead, as new regulations and fiduciary guidance seek to clarify and standardize a still nascent industry.

U.S. inflation reached an annualized rate of 7.0% in December 2021, its fastest pace in nearly four decades. Even the core price index, which excludes the volatile categories of food and energy, climbed to 5.5%. The question is whether inflation will peak in the coming months, as balance sheets are drained and supply chain pressures abate, or whether inflation has become a more permanent fixture in the U.S. economy.

Without proper planning, digital assets could be lost. For executors, a challenge is often just determining whether digital assets are in the decedent's estate, and then determining the powers and terms for accessing and administering them on the beneficiaries' behalf. An inventory checklist of the broad-based digital footprint is provided as a beginning step in protecting and planning for these assets.

The trend of private equity (PE) firms seeking high returns in health care has been in full bloom for more than a decade. But whereas previously PE was focused on a top-down approach of buying hospitals and health systems, that focus has begun to shift toward less-costly smaller specialty groups and physician practices. With increased segmentation across the health care industry, the PE involvement in core hospital service is growing and shifting.

When COVID hit, many business owners faced the dire realization that the insurance they paid so much for did not cover the business interruption resulting from the pandemic exposures. To help guard against that type of unexpected disruption in the future, many business owners have set up captives—a lucrative alternative risk financing structure—to navigate the risk and insurance challenges they face.