Investments

Portfolio Performance - October 2020

Our portfolio manager Daniel Greenhough gives us a summary of findings from the Rosecut portfolio performance against the ARC Index for October 2020, where stock markets were impacted by concerns over European lockdowns and uncertainty related to the US presidential election.

Portfolio Performance - October 2020
Source: Financial Express Analytics

You should be aware that past performance is no guarantee of future performance.

Please note: all numbers listed above are sourced from Financial Express Analytics and stated in GBP net of fees.

* The ARC PCI indices are based on the returns being generated by investment managers in the private client industry for discretionary run portfolios. More information can be found on their website here.

** The Rosecut models have an inception date of 28th February 2019.



Portfolio Performance


October saw concerns about European lockdowns and US election related uncertainty hit stock markets. The average balanced risk GBP portfolio run by the industry fell by 1%, the same as the Rosecut Balanced.


This leaves the Rosecut Balanced behind the benchmark over the past 3 months and marginally behind over 6 months.


As stated, many times before, we don't attach much value to monitoring performance over short time periods as it gives little indication of long-term potential.



Asset Class Performance (i.e. bonds, equities and alternatives)


As the most recent lockdowns are in Europe and the UK, it is perhaps no surprise that those regions stock markets fell the most over the month.


An unusual feature of the month was seeing UK government bonds falling in value, at the same time UK equity lost money. Normally they move in opposite directions, providing the all-important diversification benefits. It remains to be seen whether this is the start of a new trend or just a monthly blip.


Within emerging market regions, the virus seems to be contained for now and the economic recovery is uninterrupted. As a result, the stock markets in these regions appreciated and for once it can be said that portfolio diversification came more from geographical differences as opposed to asset allocation (bonds vs. equities).

Source: Financial Express Analytics

You should be aware that past performance is no guarantee of future performance.

In the above table, UK government bonds are represented by the FTSE All-Stocks Gilts index and UK corporate bonds by the Bloomberg Barclays Sterling Aggregate Corporate index.

The value of an investment and the income from it can go down as well as up and investors may not get back the amount invested. This may be partly the result of exchange rate fluctuations in investments which have an exposure to foreign currencies.


If you would like take a look at past performance articles, you can read our August Performance and September Performance or find more insights on our Magazine page.