Why structural returns shine in any inflationary environment

Independent of risk factors

clock • 4 min read

In 1923, John Maynard Keynes was analysing commodity futures markets when he noticed that the costs of commodity storage, which were often very high, were baked into futures pricing.

He observed speculators invested in commodity futures would not only receive the commodity return but would also be paid the storage costs on top. Keynes had discovered the first structural return - a return source embedded within a traditional asset class that is independent of the macro risks driving the market. Even Keynes did not fully understand the importance of what he had discovered. It took 85 years before the concept of structural returns became embedded in financial lexicon. The fog of war: Lasting implications of Russia-Ukraine conflict Structural returns are unique and...

To continue reading this article...

Join Investment Week for free

  • Unlimited access to real-time news, analysis and opinion from the investment industry, including the Sustainable Hub covering fund news from the ESG space
  • Get ahead of regulatory and technological changes affecting fund management
  • Important and breaking news stories selected by the editors delivered straight to your inbox each day
  • Weekly members-only newsletter with exclusive opinion pieces from leading industry experts
  • Be the first to hear about our extensive events schedule and awards programmes

Join now

 

Already an Investment Week
member?

Login

More on Commodities

London Metal Exchange wins legal case against nickel trading suspension

London Metal Exchange wins legal case against nickel trading suspension

Brought by Elliot IM and Jane Street

Elliot Gulliver-Needham
clock 30 November 2023 • 1 min read
RBC Brewin Dolphin's Janet Mui: Energy price volatility is here to stay

RBC Brewin Dolphin's Janet Mui: Energy price volatility is here to stay

Energy price shocks

Janet Mui
clock 21 November 2023 • 4 min read
Four Graphs explaining oil and gas

Four Graphs explaining oil and gas

Four experts write

Investment Week
clock 15 November 2023 • 3 min read
Trustpilot