Examining Global Infrastructure returns and sector rotation – EM take the lead

The FT Wilshire GLIO (Global Listed Infrastructure Organisation) Listed Infrastructure Indexes provide exposure to global companies which own and/or are operators of infrastructure assets

The indexes use a systematic approach to identify eligible infrastructure companies utilising EBITDA.

Examining the one month returns at the end of May, Developed Market Infrastructure outperformed Emerging Market (EM) Infrastructure. However, this move was not enough to disrupt the key theme that for 2024 - the aggregate outperformance of Emerging Market Infrastructure.

Exhibit 1: Comparing Developed v emerging Market Infrastructure returns


In fact, EM Infrastructure has now outperform Developed since 2020

Exhibit 2 compares the return delivery for Developed and EM infrastructure since the start of 2020.It can be seen that while EM Infrastructure was slower to recover after the Covid shock the recent outperformance has now pushed the cumulative return above that of Developed Market Infrastructure.

Exhibit 2: Comparing the returns profile since the Covid shock in 2020

The sector rotation perspective

In Exhibit 3 we show the sector returns for GLIO Developed Infrastructure. In May the standout (double digit) returns were delivered by the Telecom and Communication sectors. However, they remain some of the notable laggards YTD.

Exhibit 3: GLIO Developed Infrastructure sector returns – May and YTD 2024

Source: Wilshire Indexes. Date as of May 31, 2024.

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