Investor confidence is at a record high for 2021, according to State Street. The results of the local servicers’ Investor Confidence Index (ICI) for May were released on Friday, which increased to 97.9, up 5.4 points from April’s 92.5 reading. The jump is being attributed to a 6.0 point increase in North American Investor Confidence (97.8) and a 9.0 point increase in Asian Investor Confidence (100.8).

The rise of ESG and the breakdown of the traditional portfolio allocation have been contributed to a clear change in portfolio construction. Speaking at a media briefing in Sydney on Thursday, Heuristic Investment Systems head of asset allocation, Damien Hennessy, said the traditional 60:40 portfolio allocation is no longer viewed as the most logical investment ratio. “Bonds might still offer diversification in a deflationary scenario but with starting point yields so low and some emergence of inflation risk, we cannot be entirely confident that bonds will provide the buffer they have in the past. Investors have to consider other lines of defence for their portfolios,” Mr Hennessy said.

A new report released this week has given insight into the “blind spots” of climate finance where uncertainty persists for investors. The investment arm of Institutional Shareholder Services Inc. (ISS), ISS ESG, has this week released its Seeing Past the Blind Spots in Climate Finance report that looks at three “critical” areas – “the consequences of a world shifting from mitigating climate change to adapting to it, the meaning of a true Net Zero transition and legal and other issues surrounding companies viewed as obstructing climate protection”. The new report follows this month’s release of ISS’ landmark report Net Zero by 2050, coined the “IEA NZE Roadmap”.

The ATO has issued a stern warning to investors in cryptocurrency ahead of tax time this year. Speaking at a tax-time tip seminar last week, ATO assistant commissioner Adam O’Grady warned crypto investors that his office will be watching all events related to the asset class come tax time. “It is really important for all capital assets; we will be looking to ensure that the people have reported the capital gains events – and this is for both gains and losses,” Mr O’Grady said.