How Prepared is your Portfolio for Tail Risks?
- 03 Feb 2023
Exploring the Unknowns
The inaugural PGIM 2022 Global Risk Report canvassed 400 global institutional investors with a combined AUM of $12+ trillion to identify tail-risk scenarios with a perceived low likelihood of occurrence, high potential impact, and low level of preparedness over the next few years.
Explore the research, highlighting three global tail risks, and six country-specific risks cited by investors in the US, UK, Germany, Japan, Australia and China.
GLOBAL TAIL RISKS
Unexpected liquidity crunch in capital markets
Military conflict in the Taiwan Strait or South China Sea
Cyberattack disables a major financial platform or government
COUNTRY-SPECIFIC TAIL RISKS
Australia - US and China ban bilateral trade
China - Second global pandemic causes another shutdown
Germany - China's real estate bubble pops
Japan - Global economic slowdown forces central banks to revert to ZIRP
UK - Eurozone economy defaults on its debt
US - 10-year Treasury reaches double-digit yields
RISK MITIGATION STRATEGIES