Some of the potential risks for 2022 include the end to the bull market, which Lovelace said is less of a problem in listed securities than in private investment in public entities. There are also concerns about private credit, which is looking like a bubble especially since a lot of investors have been going there in a reach for yield, he said.
“You don’t have to figure out what will start the fire, you just need to know the brush is dry,” he said. “There’s less room for mistakes. If you’ve been experimenting with investments, it’s time to get back to basics.”
And the big story that’s going to keep snowballing through the next decade? ESG.
“It’s a major, major topic outside the U.S. Demand is coming from everywhere, from regulators, from clients, and its fundamentally changing the investment landscape,” Gitlin said. “You do not leave a conversation with a client in the U.K. or Europe without talking about ESG, bar none. Every single one. And it’s gaining traction and mind share also in the U.S.”
All of those factors mean it has to be front and center of what investors are thinking about, because ESG will impact companies, their strategy and market prices, he said.
“So if you have a personal view on it, put it to the side. If something’s going to impact the markets, you need to understand the dynamics and the drivers,” he said.