On 8 March 2021, CFA Institute will be conducting a global survey for all members on the topic of the COVID-19 crisis and its impact on capital markets and the investment management industry, approximately one year after health measures generated an economic and market crisis.
This survey follows a CFA Institute member survey conducted in April 2020, the results of which contributed to the report “Is the Coronavirus Rocking the Foundation of Capital Markets?”.
To amplify the level of awareness of the survey and maximize the response rate, we are asking the CFA Society® community to encourage participation and engage local stakeholders.
What are we trying to achieve with this survey
We would like CFA Institute and the CFA Society community to be recognized as a trusted, go-to source of meaningful information on the impact of the COVID-19 crisis on financial markets.
This crisis is unprecedented in its causes and wide-ranging consequences for the industry and authorities. It is, therefore, unsurprising that we have observed commentary in the press that is imprecise and subject to knee-jerk reaction to the events that are unfolding.
As a membership organisation, we are in a good position to offer an interpretation of events to the media, regulators and stakeholders through a careful analysis of the opinion garnered from our expert membership. The diversity of this membership in terms of experience, backgrounds and professional fields is invaluable in forming a view as to the actual and structural consequences the crisis is having on the investment management industry.
What are the survey themes?
This second COVID-19 survey will focus on:
- The shape of the economic recovery one year after. The discussions around a K-shape or W-shape.
- The view of the members on equity valuation (and interestingly whether markets are disconnected from the real economy), interest rates, inflation, corporate credit risk.
- The structural consequences of the crisis on financial markets and the economy.
- Exploring the trends related to the platform economy, impact of Big Tech, ESG, the role of government and globalisation.
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- What members think of the relief programmes that were enacted. How are they going to be paid for? The risk of tax rises or debt monetisation.
- Importantly, we want to amplify our access to the CFA Institute-sponsored Systemic Risk Council (SRC) and discuss central bank monetary stimulus, potential exit plans, and the impact on markets and investment management. We would like to know what the consequences are of such unprecedented drive of monetary stimulus on the normal functioning of financial markets and the risks that are emerging as a consequence.
- Also crucial is the regulatory angle. We would like to know if members approve of the decisions taken by prudential and conduct/securities regulators. What are the risks that regulators should now be focusing on? Is pension a key concern? Liquidity risk? Systemic risk? Competition? The green or digital transition?
What are we asking of the CFA Society network?
To help maximise the reach of the survey, please consider:
- Preparing your membership for this survey and encourage participation.
- Reaching out to your members directly and discuss the coming survey. Here is a draft email that you can use to encourage participation locally.
- Explaining to members why this is important.
- Letting us know if you have any administrative or technical issues that could result in members not getting the survey through normal communication channels.
- Sharing any feedback from respondents with us.
Many local societies seized the opportunity afforded by the data from the first survey to conduct local webinars, produce local reports on the survey, deliver presentations to members and regulators, and engage in media outreach.
We hope that the results of this second survey will provide similar opportunities and we will provide resources to help you raise awareness of the research locally. Such resources are likely to include:
- Global results and presentation material.
- Regional and localised results depending on demand.
- The organisation of webinars/conferences to discuss the results with your local audience, media or regulators.
- Video material on the results if useful.
What did we learn from the first survey?
Key takeaways from the first report:
- Members were more conservative than often heard in the press about the potential recovery and favoured a medium-term recovery in the form of a hockey stick.
- Investment firms were not panicking about the observed volatility, preferring to wait before making siginificant changes if required. There was however a real worry that the current stress could result in specific asset mispricing imbalances.
- Respondents appeared to agree that the decision to support the economy and markets by authorities and central banks was justified, yet there was disagreement as to whether this support should be continued or stopped.
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- Respondents seemed to agree regulators have a role to play in the recovery and also that conduct rules should not be relaxed to accommodate firms.
- Respondents believed that the current stressed conditions would generate unethical behaviour in the investment management industry.
- There appeared to be a recognition that markets are an important part of how the economy operates and that it is important to show these markets continue to function appropriately. The crisis will have a structural impact on the industry and could result in consolidation.
- A significant proportion of respondent doubted that the crisis could facilitate a return of active management in investors’ preferences and results.
- Most firms appeared to be in waiting mode as regards hiring plans. It was too early to tell the impact on employment in the finance industry. A proportion of respondents did express a worry about their personal job security.
Survey Response rates:
Per region, results were:
If you have any questions, please contact:
Olivier Fines, CFA, Head of Advocacy, EMEA, CFA Institute olivier.fines@cfainstitute.org
Delme Thompson, Senior Director, Society Relations, CFA Institute delme.thompson@cfainstitute.org
We thank you in advance for your support.
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