Scientific Beta Newsletter
Bridging the Gap between Academia and Industry | |
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Quarterly, Issue 35, January/February 2022 |
| Performance in 2021 Mostly Driven by Positive Inflation Surprises |
| Inflation in the US rose faster than expected to a near 40-year high at the end of 2021, with inflation accelerating beyond expectations. As a result, last year was mostly characterised by unexpected inflation shocks or positive inflation surprises. To benefit from inflation surprises, Scientific Beta has developed an advanced methodology to measure the sensitivity of stocks to such surprises, whether they be positive (excess realised inflation compared to expectations) or negative (lower realised inflation compared to expectations). The Scientific Beta Inflation indices are designed to offer good conditionality to periods of positive or negative surprises in expected inflation. More... |
| Updated TCFD Recommendations and Guidance: Implications for Corporates and Investors |
| In a recent overview paper, Scientific Beta reviewed the background and architecture of the TCFD recommendations and presented the 2021 guidance. In this short piece, we briefly present the framework of the TCFD recommendations, focus on new or updated disclosures requirements and advice, discuss issues that have been resolved or remain pending and conclude on the relevance for Scientific Beta strategies. More... |
| The Future of Climate-Related Disclosures and Implications for Alignment Strategies
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| Two of the most significative developments of relevance for climate-related disclosures in recent months are the update of the implementation guidance of the Task Force on Climate-related Financial Disclosure (TCFD) recommendations in October and the entry into force, on 1 January 2022, of the most ambitious sustainable investment taxonomy regulation to date. Here we discuss implications for portfolio construction with Scientific Beta ESG Director Frédéric Ducoulombier. More... |
| Documents authored by Scientific Beta featuring its latest research. |
Scientific Beta Enhanced ESG Reporting – Supporting Incorporation of ESG Norms and Climate Change Issues in Investment Management
November 2021 |
| This paper focusses on Scientific Beta's Enhanced ESG Reporting framework, which covers ESG Norms, Climate Transition Risks, Climate Change and Greenwashing. More... |
Assessing the Robustness of Smart Beta Strategies
December 2021 |
| This paper discusses why robustness is relevant for investors in smart beta strategies and describes the sources of deficiencies. More... |
| Supplements in Partnership with Industry Publications |
IPE EDHEC Research Insights
Autumn 2021 |
A special issue presenting Scientific Beta's latest research in the fields of smart factor and ESG/Climate index design and implementation:
- 'Honey, I shrunk the ESG alpha'
- Doing good or feeling good? Detecting greenwashing in climate investing
- When you do not put your money where your mouth is. How portfolio greenwashing compromises investors' climate engagement
- Inflation-friendly equity indices. How to protect against rising inflation in equity portfolios
- Targeting macroeconomic risks in equity portfolios
- When greenness is mistaken for alpha. Pitfalls in constructing low carbon equity portfolios
- Scientific Beta Climate Impact Consistent indices
- War and peace. Positioning equity portfolios for trade policy shifts
More... |
| The latest news about Scientific Beta and its activities. |
| Scientific Beta Welcomes Updated TCFD Guidance and Renews Criticism of EU Climate Transition and Paris-Aligned Benchmark Regulation |
| Scientific Beta has reiterated warnings against the use of enterprise-value based carbon intensity and regards integration of implied temperature rise metrics into portfolio construction as premature. More... |
| Scientific Beta Survey Shows that Most Investors do not Believe in ESG Outperformance |
| Scientific Beta conducted a survey to collect market participants' views on its recent white paper '"Honey, I Shrunk the ESG Alpha": Risk-Adjusting ESG Portfolio Returns' which questions the popular belief that ESG strategies generate outperformance. More... |
| Scientific Beta Wins "Best Specialist ESG Index Provider" Category at the ESG Investing Awards 2022 |
| Scientific Beta is pleased to announce that it has been named "Best Specialist ESG Index Provider" at the ESG Investing Awards 2022, the world's leading awards celebrating excellence in Environmental, Social and Governance (ESG) research, ratings, funds and products. More... |
| Research and education are a core part of Scientific Beta's strategy and we regularly organise events to contribute to bridging the gap between academia and industry. |
Macro-Tilted Equity Indices: Protecting your Equity Portfolio against Inflation and other Macro Surprises
9 February, 2022 – 2.00pm EST / 8.00pm CET |
| This P&I webinar will present Scientific Beta's equity inflation indices, the first in a series of macroeconomic factor indices that provide long-term equity performance with additional inflation protection compared to a traditional cap-weighted equity index. More... |
| Recordings of recent webinars broadcast by Scientific Beta. |
| When Greenness is Mistaken for Alpha: Pitfalls in Constructing Low Carbon Equity Portfolios |
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Our research results suggest that using low carbon strategies as a source of alpha is costly to investors. This does not imply that investors cannot benefit from low carbon investing. Investors should analyse whether low carbon strategies can help them hedge climate risks or make a positive impact on corporate behaviour. More... |
| A selection of articles published in the international business and specialised press featuring Scientific Beta and its research. |
- "Scientific Beta: How to protect your equity portfolio against rising inflation", Financial Investigator (18/01/2022). More...
- "EU's new carbon-scoring metric bedevils investors", Risk.net (17/11/2021). More...
- "Scientific Beta survey shows that most investors do not believe in ESG outperformance", Institutional Asset Manager (09/11/2021). More...
- "ESG metrics trip up factor investors", Financial Times (01/11/2021). More...
- "Climate change ETFs found to be undermining war on global warming", Financial Times (20/09/2021). More...
- "Fighting climate change in Asia: an exchange-led approach", World Federation of Exchanges (August 2021). More...
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| Senior Product Specialist, Quantitative Investment Solutions (London) |
| As part of its international development programme and in order to strengthen its client-facing Product Specialist team, Scientific Beta is recruiting for a position in its London offices. More... |
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9. Contact
Scientific Beta
1 George Street, #15-02, Singapore 049145
Tel. +33 493 187 851 (from 3.00am to 11.00pm CET)
E-mail: clientservices@scientificbeta.com
Website: www.scientificbeta.com
About Scientific Beta
Scientific Beta aims to be the first provider of a smart factor and ESG/climate index platform to help investors understand and invest in advanced factor and ESG/climate equity strategies. Established by EDHEC-Risk Institute, one of the top academic institutions in the field of fundamental and applied research for the investment industry, Scientific Beta shares the same concern for scientific rigour and veracity, which it applies to all the services that it offers investors and asset managers. On January 31, 2020, Singapore Exchange (SGX) acquired a majority stake in Scientific Beta. SGX is maintaining the strong collaboration with EDHEC Business School, and principles of independent, empirical-based academic research, that have benefited Scientific Beta's development to date. Since 2015, Scientific Beta has also been offering highly advanced strategies in the area of ESG and climate change, whether involving options integrated into smart beta indices or pure ESG or climate benchmarks. As a complement to its own research, Scientific Beta supports an important research initiative developed by EDHEC on ESG and climate investing and cooperates with V.E and ISS ESG for the construction of its ESG and climate indices. More... | |
 
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