Voya Financial, Inc. · NYSE:VOYA
Voya Financial — Investor Presentation (October 2021)
37 slides from Voya Financial's investor presentation, October 2021
Slide 1: Voya Global Perspectives
October 2021 Voya Global Perspectives Market. Insights. Opportunities.® CN1483104_0122 20210119-1483104-4475878 Voya Global Perspectives®
Slide 2: 2021 Forecast
2021 Forecast 20210119-1483104-4475878 Voya Global Perspectives® 2
Slide 3: Advancing Earnings Drive the Market
Advancing Earnings Drive the Market Corporate earnings growth is a barometer for the health of the global economy. Source: Refinitiv – Thomson Reuters and FactSet, Voya Investment Management. Earnings per share (EPS) is the portion of a company’s profit allocated to each outstanding share of common
Slide 4: Broadening Manufacturing
Broadening Manufacturing Global Manufacturing PMIs U.S. Industrial Production 66 110 62 58 58.58 Euro Expansionary (>50) 61.10 U.S. 100 Index Level 54 Index Level 50 49.60 China 90 46 U.S. 42 Contractionary (<50) recessionary periods 80 38 34 70 30 1997 2001 2005 2009 2013 2017 2021 10/18 04/19 10/1
Slide 5: Consumer as Game Changer
Consumer as Game Changer At about 70% of gross domestic product (GDP), the U.S. consumer is a game changer. 650 618.68 600 $ Billions per month 550 500 450 400 U.S. Retail Sales 350 2011 2014 2016 2019 2021 Source: FactSet. U.S. retail sales as of 8/31/21. 20210119-1483104-4475878 Voya Global Perspe
Slide 6: Diversification
Diversification Global effective diversification has beaten the S&P 500 over a long period of time Source: FactSet, FTSE NAREIT, Voya Investment Management. The Overall Average model allocation includes 10 asset classes, equally weighted: S&P 500, S&P 400 Midcap, S&P 600 Smallcap, MSCI U.S. REIT Ind
Slide 7: A Plan for the Inevitable Bear Market beats "Stay the Course"
A Plan for the Inevitable Bear Market beats “Stay the Course” Strategic and tactical allocation over 20 years shows that active management may add value especially in market downturns. Tactical G r o Strategic w t h S&P 500 Index $ 1 Market Fundamentals S&P 500 Earnings Growth Tactical Signal Positi
Slide 8: Europe Years Europe Lags U.S. Markets
Europe 20 Years Europe Lags U.S. Markets 5.0 S&P 500 4.5 MSCI EAFE S&P 500 Index Bloomberg Global Aggregate 4.0 Bloomberg US Aggregate Growth of $ 3.5 3.0 MSCI EAFE index 2.5 2.0 Barclays U.S. Aggregate 1.5 Barclays Global Aggregate 1.0 0.5 '12 '13 '14 '15 '16 '17 '18 '19 '20 '21 Data as of 10/11/21
Slide 9: The Fed
The Fed The U.S. Federal Reserve and other Central Banks are again expanding their balance sheets. Fed Balance Sheet ($) 9,000 ECB Balance Sheet (€) BoJ Balance Sheet (¥) Assets in Local Currency - Millions 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0 2007 2008 2009 2010 2011 2012 2013 2014 201
Slide 10: Global Growth
Global Growth World economic growth has doubled from 2003 to 2018. Source: International Monetary Fund (IMF) as of 2018. Note: Advanced economies comprises 36 countries; developing economies comprises 153 countries. 20210119-1483104-4475878 Voya Global Perspectives® 10
Slide 11: Housing
Housing 25 280 S&P Case Shiller Housing Index 271 20 260 15 240 10 Case-Shiller 1-Year Case-Shiller % change % (LHS) 220 5 Index Level 200 0 180 -5 Case-Shiller Level (RHS) 160 -10 140 -15 -20 120 -25 100 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021 Source: FactSet, S&/P Case-Shiller as of
Slide 12: Inflation
Inflation 6 5.30 Headline CPI Y/Y 5 4 4.00 Core PCE Y/Y 3.62 Core CPI Y/Y Percent (%) 3 2 1 0 2017 2018 2019 2020 2021 Source: FactSet, Inflation as of 8/31/2021. 20210119-1483104-4475878 Voya Global Perspectives® 12
Slide 13: Jobs
Jobs The unemployment rate has slowly improved in line with economic growth. 4,900,000 Initial claims 16% 5 million 800,000 14% New Weekly Claims Unemployment Rate 12% 600,000 Unemployment Rate (RH) 10% 8% 400,000 6% Initial Unemployment 200,000 Claims (LH) 4% 2% 2001 2004 2006 2008 2010 2012 2015 2
Slide 14: Dow Jones Industrials (price only — years)
Dow Jones Industrials (price only — 100 years) It is not unusual for stocks to have prolonged periods of flat returns. 40,000 30,000 20,000 10,000 Q1 2020 Global Pandemic 4,000 3,000 Log Tech Wreck Great 2,000 2000-2002 Recession 1,000 2007-2009 400 OPEC Oil Crisis 300 200 100 Pearl Harbor 40 1910 1
Slide 15: Index Total Returns
Index Total Returns Data as of 9/30/21. Large-cap companies are typically firms with a market value of $10 billion or more. Investments in large-cap stocks may be considered more conservative than investments in small-cap or mid-cap stocks, potentially posing less risk in exchange for less aggressiv
Slide 16: The Fed Model
The Fed Model Stock and Bond comparison translated into comparable valuations 16 Earnings Yield (solid = forward, dotted = trailing) 14 U.S. Treasury Yield (10 year) 12 Equivalent to 10 P/E* of 20.4 Percent (%) 8 EPS Yield 4.91 % 6 4 Equivalent to P/E* of 71 2 T-Yield 1.40% 0 1970 1975 1980 1984 199
Slide 17: U.S. Consumer Confidence
U.S. Consumer Confidence 200 180 160 Present 140 Index Level 120 Total Index 100 80 60 40 U.S. Retail Sales 20 0 2012 2014 2016 2018 2020 20210119-1483104-4475878 Source: Factset. Consumer Confidence as of 9/30/21, Retail sales as of 9/30/21 Voya Global Perspectives® 17
Slide 18: Performance by Market Capitalization
Performance by Market Capitalization Mid-cap stocks generally have grown faster than large caps since 2005 and growth over value. 4.5 (INDEX) Russell Mid Cap - Price 2,200 (INDEX) Russell 1000 - Price Mid Cap 4.0 (INDEX) Russell 2000 - Price 2,000 Large Cap 3.5 Russell 1000 Growth Index 1,800 Small
Slide 19: The Fed
The Fed Fed Funds Target Rate 10 8 Percent (%) 6 4 Average 2 0.25 0 1999 2003 2006 2009 2012 2015 2018 2021 Source: FactSet, Fed Funds Target Rate, data as of 9/30/2021. Average Fed Funds Rate is average since 1988. 20210119-1483104-4475878 Voya Global Perspectives® 19
Slide 20: Equity Volatility (VIX)
Equity Volatility (VIX) Volatility tends to spike when investors get complacent after long periods of low vol 12/31/07 = 22.5 11/20/08 = 80.9 Lehman Crisis 87 China Coronavirus 12/31/08 = 40.0 Euro Crisis U.S. Credit Currency 40 10/08/21 = 18.77 Downgrade Devaluation Brexit 35 Index Level 30 25 Hist
Slide 21: Bond and Loan Returns
Bond and Loan Returns Long-term U.S. Treasurys have been winners in periods of uncertainty. Data as of 6/30/21. Investment Grade bonds are bonds that have an investment grade rating of Baa or higher from Moody's Investors Service, a rating of BBB or higher from Standard & Poor's or both and typicall
Slide 22: Global Yields
Global Yields Investors seeking income may benefit from the higher yield available from global bonds. Current 10-Year Sovereign Bond Yields as of 9/30/2021 Source: FactSet. Past performance is no guarantee of future results. An investment cannot be made in an index. Please review important disclosur
Slide 23: Growth & Reflation
Growth & Reflation Growth and Inflation Growth and Reflation The 10-year U.S. Treasury yield historically tracks real U.S. GDP and inflation. 15 10 6.70 Percent (%) 5 4.00 1.53 0 10-Year Treasury Yield Real U.S. GDP -5 Inflation – Core CPI Y/Y 1975 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1
Slide 24: Credit Spreads and TED Spread
Credit Spreads and TED Spread Credit spreads indicative of risk : low or narrow is good; high or wide is bad TED Spread (Libor – 3-month Treasury) High Yield Spreads 4 1,000 Lehman crisis 900 3 800 700 2 Basis Points Percent (%) 600 1 500 400 0.09 0 300 200 -1 2017 2018 2019 2020 2021 1990 1995 1999
Slide 25: U.S. Export, Import Growth (YoY % Change)
U.S. Export, Import Growth (YoY % Change) U.S. trade is highly dependent on global economic growth. 50 Recession 40 30 20 10 % 0 -10 -20 -30 2001 2003 2006 2008 2010 2012 2014 2017 2019 2021 (% 1YR) Exports (% 1YR) Imports Source: FactSet. Data as of 7/30/21. 20210119-1483104-4475878 Voya Global Per
Slide 26: International Economics
International Economics The “Big 3” dominate the global economy while the U.S. and China is putting distance on Europe Source: FactSet. Data are most recent available as of 12/31/20. 20210119-1483104-4475878 Voya Global Perspectives® 26
Slide 27: Savings Rates and Household Net Worth
Savings Rates and Household Net Worth Household net worth and savings rate remains high. Savings Rate Household Net Worth 30 3 month average, % of disposable income 150 140 141.67 25 130 120 Household wealth has 110 rebounded since the 20 financial crisis 100 $ trillions 90 15 80 70 10 9.63 60 50 5
Slide 28: Commodities Prices
Commodities Prices Gold actually sells for less today in real — inflation-adjusted — terms than in 1980. $2,400 $/ton $/oz. $12,000 600 COPPER $/ton $2,000 550 $10,000 CRB Index $1,600 500 $8,000 $1,200 450 GOLD $6,000 400 $800 Nominal Price/oz. GOLD Real Price/oz. 350 $400 $4,000 300 $0 1976 1984 1
Slide 29: Oil Price and Intensity
Oil Price and Intensity Crude oil prices are a good indicator of global demand with too high and too low both ominous 200 1,000 150 Barrels per $1 Million of GDP 800 Crude Oil (NYM $/billion) 100 Oil Intensity Price $ per Barrel 77.43 600 50 400 0 30 year average = $43.4/barrel 60% less oil is requi
Slide 30: U.S. Government Debt and Deficit
U.S. Government Debt and Deficit U.S. Government Debt Debt Levels 30,000,000 $28.4 Trillion 125.54 25,000,000 20,000,000 % of GDP $ Trillions 15,000,000 Debt 10,000,000 5,000,000 2005 2008 2012 2015 2018 2021 '92 '94 '96 '98 '00 '02 '04 '06 '08 '10 '12 '14 '16 '18 '20 Source: FactSet. U.S. governmen
Slide 31: Corporate Income Tax Rates
Corporate Income Tax Rates U.S. corporate income taxes were slashed in 2017 improving its competitive advantage. Percent (%) Source: Organization for Economic Cooperation and Development. Data as of 2020. 20210119-1483104-4475878 Voya Global Perspectives® 31
Slide 32: The Folly of Gaming Diversification
The Folly of Gaming Diversification Source: FactSet, Voya Investment Management. Note: “Global AA” includes 10 asset classes, equally weighted: S&P 500, S&P 400 Midcap, S&P 600 Smallcap, MSCI U.S. REIT Index/FTSE EPRA REIT Index, MSCI EAFE Index, MSCI EM Index, Bloomberg Barclays U.S. Corporate Bond
Slide 33: Sequence of Returns Matters
Sequence of Returns Matters It is crucial to de-risk once retirement begins due to possible adverse “Sequence of Returns” Date Annual Income Annual Returns Portfolio Value Annual Returns Portfolio Value Starting Nest Egg Value $ 1,000,000 $ 1,000,000 Year 1 $ 40,000 -5% 912,000 15% 1,104,000 Year 2
Slide 34: Index Definitions
Index Definitions Bloomberg Barclays U.S. Aggregate Bond Index is composed of U.S. FTSE NAREIT U.S. Real Estate Index presents comprehensive REIT securities in Treasury, Government-Related, Corporate and Securitized sectors performance across the U.S. economy, including all commercial investment tha
Slide 35: Index Definitions
Index Definitions Asset classes are represented by the following indexes: S&P SmallCap 600 Index covers approximately 3% of the domestic equities market and is designed to represent a portfolio of small companies that are Bloomberg Barclays U.S. Corporate Bond Index is a component of the investable
Slide 36: Index Definitions
Index Definitions MSCI U.S. REIT Index is a free float-adjusted market capitalization weighted Russell Midcap Value Index measures the performance of the mid-cap value index comprised of equity REITs that generate a majority of their revenue and segment of the U.S. equity market including Russell Mi
Slide 37: Important Disclosures
Important Disclosures This information is proprietary and cannot be reproduced or distributed. Certain The views and judgments expressed are those of Voya Investment information may be received from sources Voya Investment Management Management. They are subject to change at any time. These views do
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