At current levels, market expectations are for a prolonged (ten years or longer) period of low real cash returns which, if borne out in practice, will have a profound impact on expected asset class returns and the ability of investors to achieve their investment return objectives.

This paper looks at why we believe it is important for investors to revisit their approach to the low return environment at the present time; the returns that investors might expect over the coming decade compared to more ‘normal’ levels; the impact of the low return environment on the likelihood of investors achieving their return objectives and potential responses to the low return environment, the anticipated effectiveness of different responses and the type(s) of investors for whom each response might be appropriate.