The steady yields help the pension funds meet their liability driven investment portfolios, which try to accumulate sufficient assets to meet all present and future liabilities.
Over the long-term, the sector offers growing opportunities as many emerging markets expand their inadequate infrastructures and developed economies update their aging infrastructure. Standard & Poor’s projects infrastructure financing needs worldwide could tota $3.4 trillion annually through 2030. [Infrastructure ETFs for Global Growth]
“Local economic growth, especially in emerging-markets countries, can drive infrastructure investments,” according to Morningstar analyst Robert Goldsborough. “In developed-markets nations, by contrast, local growth by definition is slower, but regular infrastructure upgrades often are necessary and desired.”
iShares Global Infrastructure ETF
For more information on the infrastructure sector, visit our infrastructure category.
Max Chen contributed to this article.