Investment Markets, Portfolio Performance and Opportunities.

Firstly we very much trust you and your families are well.

I have been laid low following what was expected to be relatively routine surgery which developed complications but thankfully I feel that I am on the mend now.  I am having to take things slowly but I am hoping to be able to work normally by the end of the month.  In the meantime, as always, if you have any pressing advice needs, call the office and speak to Sian and the team and we will assist you as quickly as we can.  I am looking forward to returning and being as busy as previously.

Expansion of Qualified Administration Support

We have another qualified adviser/member of staff – Natalie – who supports Sian and her team who will also be supporting my workload over time so this is great news from a resource viewpoint.

Investment Markets

You will have noticed that the markets have Yo Yo’d over the recent months.  As an example, the FTSE 100 has moved between 6900 and 7200, depending on news flow, although we are now moving towards the time of the year when markets are historically stronger.  Covid 19 news will continue to drive policy which, in turn, will drive markets so for those who have inflation worries and cash surplus you would be best looking at your asset allocations in order to deploy capital or surplus income to work, to deliver inflationary protection against cash like holdings, given the currrent outlook.

If you require advice in relation to your financial affairs, simply get in touch.

Portfolio Performance

As mentioned, the equity markets have been somewhat negative recently with a number of growth sectors being impacted over the last 3 months or so.

The ‘transitory inflationary’ view has created uncertainty with investment markets which in turn places concern into markets, increasing the ‘downs’ and ‘ups’ of investing.

The outlook for investing remains solid against the returns available from holding cash, especially when inflation adjusted.  As always, building a balanced portfolio that outperforms over the medium to longer term is essential.

The most recent portfolio results confirm that our Risk adjusted portfolios continue to perform exceptionally well and manage risk aligned to our investors’ needs.

Please see the performance data summary over Risk adjusted investment portfolios in descending risk order.

Since 29/11/2019 the out performance versus the Flexible Benchmark has been considerable 40.28% v 17.34% with a volatility difference of 16.08% against 12.34%.

Performance is 35.89% since 10/4/19 v 23.72% for the Benchmark, with volatility being 12.64% (Portfolio) and 11.22% (Benchmark).

5-year out performance is 69.72% Portfolio versus 41.65% Benchmark, with volatility difference being 10.19% (Portfolio) v 9.12% (Benchmark)

5-year out performance is 66.53% Portfolio versus 41.65% Benchmark, with volatility difference being 9.73% (Portfolio) v 9.12% (Benchmark).

The out performance since 15/6/17 has been 36.59% versus 29/11% against a substantially lower level of investment volatility; 8.62% (Portfolio) against 10.02% (Benchmark)

Risk Model 5 Portfolio out performs to the 5 year point 47.85% against 41.33% (Benchmark) with lower volatility (Risk) at 8.30% (Portfolio) against 9.43% (Benchmark)

Since 30/10/19 the Risk Model 4 Portfolio has out performed 21.55% against 11.96% Benchmark, with lower volatility (Risk) at 10.31% against 10.39% (Benchmark).

Since 15/6/17 Risk Model 3 Portfolio has out performed by 27.17% against 13.05% Benchmark.  The volatility has been 6.81% (Portfolio) against 5.28% (Benchmark).

Since 27/9/17 the out performance of Risk Model 2 Portfolio has been 23.42% against 13.94% Benchmark with volatility being lower at 4.99% against the Benchmark of 5.41%.

Pleasing results

I am sure you will agree that the results are very pleasing when considered against relative benchmarks and the risk taken (volatility) to deliver the Portfolio results.

You may wish to consider if you would have the risk capacity and tolerance to increase the ‘risk’ of your Portfolio – if so, simply get in touch.

Opportunities

It is the time of the year when investors start to plan and invest appropriately so you may want to further consider your objectives for investing and tax planning.

Tax effective investing using VCT’s, EIS and Business Relief investments are becoming increasingly mainstream for:

Company Directors with surplus cash in companies;

High earners facing Pension Annual Allowance limitations;

Investors who are impacted by Pension Lifetime Allowance, landlords/second home owners who wish to sell properties but want to plan around the CGT impact;

Clients/Investors who have made capital gains in the last 3 years or will do in the next 12 months.

These are a number of simple examples where planning advice can assist in building a suitable investment programme in a tax effective way.

ESG investing – we are able to support the construction of ESG investing which is becoming increasingly mainstream so if you want to focus on ESG investing, simply get in touch.

I trust you find this overview and summary of assistance.

Very best wishes and we look forward to hearing from you and catching up soon.

Kind Regards.

Richard and Team