NEWSLETTER of February 28, 2025

The following content has been added at finexpert:

KPMG
H2 2024 - PULSE OF FINTECH
2024 proved to be another challenging year for the global fintech market as both total investment ($95.6 billion) and the volume of deals (4,639) fell to seven-year lows. Ongoing macroeconomic challenges, geopolitical conflicts and tensions, and a number of high-profile elections in major jurisdictions around the world kept the level of uncertainty very high, leading to a pullback in fintech investment particularly on the M&A and PE fronts. >more

Allianz
CLIMATE RISK AND CORPORATE VALUATIONS
Investors today face dual climate risks that stem from both the transition to a sustainable economy and the increasing severity of physical climate events. Transition risks arise from rapid policy changes, technological innovations and evolving market behaviors, while physical risks include the damaging impacts of extreme weather, rising sea levels, prolonged droughts or productivity losses for workers exposed to heat. Together, these risks accelerate the devaluation of assets, potentially rendering them stranded long before the end of their expected lifecycles. >more

KKR
CREDIT AND MARKETS: Q4 2024 REVIEW & 2025 OUTLOOK
In 2007, Steve Jobs introduced the iPhone, changing how we connect, work, and interact with the world. It wasn’t just a new device — it was a revolution. Today, we see a similar shift happening in credit markets. Traditional, siloed products are giving way to diversified, multi-asset credit solutions — much like how the iPhone replaced single-purpose devices with an all-in-one platform. In an evolving macroeconomic landscape marked by geopolitical tensions, tariffs, and rising bond yields, building a resilient portfolio requires adaptability and income diversification. >more

KfW Research
VENTURE CAPITAL – MARKTTRENDS 2025
Professional venture capital investors have in-depth technology and industry knowledge, invest to generate returns and therefore play a key role in the allocation of innovation and growth capital. The expectations of German investors currently diverge across the various technological domains. Investors see very good growth opportunities for artificial intelligence, cybersecurity and dual use technologies. Climate tech evolved into the technological area with the highest deal volume in the German venture capital market in 2024 but growth expectations for 2025 are more muted than three years ago. Investors see relatively low growth opportunities in more mature markets, especially in e-commerce. >more

Roland Berger
DIE DEUTSCHE KONJUNKTUR IM JAHR 2025
German economic output has been declining for two years. Relevant indicators also point to continued economic weakness in the coming year. What's more, it's not just economic challenges that are keeping German companies busy - far-reaching structural problems are also increasingly coming into focus and clouding the mood. >more

THE UNINTENDED CONSEQUENCES OF REBALANCING
Campbell R. Harvey, Michele G. Mazzoleni, and Alessandro Melone
2025
Institutional investors engage in trillions of dollars of regular portfolio rebalancing, often based on calendar schedules or deviations from allocation targets. We document that such rebalancing has a market impact and generates predictable price patterns. When stocks are overweight, funds sell stocks and buy bonds, leading to a decrease in equity returns of 17 basis points over the next day. Our results are robust to controls for momentum, reversals, and macroeconomic information. Importantly, we estimate that current rebalancing practices cost investors about $16 billion annually-or $200 per U.S. household. Moreover, the predictability of these trades enables certain market participants to profit by front-running the orders of large institutional funds. While rebalancing remains a fundamental tool for investors, our findings highlight the costs associated with prevailing strategies and emphasize the need for innovative approaches to mitigate these costs. >more

NON-COMPETE AGREEMENTS AND THE MARKET FOR CORPORATE CONTROL
Andrey Golubov, and Yuanqing (Lorna) Zhong
2024
Non-compete agreements (NCAs) limit outside employment options and, therefore, increase personal costs of job displacement for managers. Using state-level changes in NCA enforceability as a natural experiment, we find that managers are more averse to horizontal takeovers when NCA enforcement tightens. In particular, higher enforceability is associated with fewer same-industry takeovers. Those that do materialize are more likely to be hostile, involve higher premiums, and are less likely to complete. Overall, the findings indicate that the use of NCAs and their enforceability have important implications for the market for corporate control and that banning NCAs could actually promote consolidation. >more