Growth and Income Portfolio Updates - Autumn 2020 | AAG Wealth Management

Growth and Income Portfolio Updates – Autumn 2020

Posted: October 16, 2020

Autumn leaves in forest

 

Growth and Income Portfolio Updates – Autumn 2020

Third quarter performance analysis for the St. James’s Place Growth and Income Portfolios.

This year has been a testing one for investors, and the third quarter of 2020 was no different. Although the summer began with an optimistic mood in certain markets, as the quarter ended that mood was giving way to a sense of caution. In these updates, we review how our Growth and Income Portfolios have performed through this period.

Adventurous Portfolio

The Portfolio performed well during the third quarter. The emerging market funds were the top performers as the Chinese and Indian stock markets delivered double digit returns. The worst performing regional fund was the UK & General Progressive Fund, although the fund outperformed the wider UK market. This fund was removed from the Portfolio in September. The Global Value fund detracted the most from performance following its addition in September, as ‘value’ style stocks remained out of favour. Click here to read the full Adventurous Portfolio Update.

Balanced Portfolio

The Portfolio recovered well during the second quarter. The equity funds provided the largest contribution to returns, with the Emerging Markets Equity fund the standout performer, driven by stock selection in India, Argentina and China. Click here to read the full Balanced Portfolio Update.

Balanced Income Portfolio

Portfolio performance was positive in Q3. The best performing funds in the Portfolio were those with substantial exposure to high yield corporate bonds, such as the International Corporate Bond and Diversified Assets funds, and the global equity funds, which kept pace with the continued momentum in international equity markets. The worst performing fund, and biggest detractor from returns was the Property fund which realised 6 months of performance following the unsuspension in September, reflecting reduced valuations in retail and leisure properties. Click here to read the full Balanced Income Portfolio Update.

Conservative Portfolio

Portfolio performance was positive in Q3. The best performing funds in the Portfolio were those with substantial exposure to high yield corporate bonds, such as the International Corporate Bond and Diversified Assets funds, and the Worldwide Opportunities fund, which kept pace with the continued momentum in international equity markets. The worst performing fund, and biggest detractor from returns was the UK Absolute Return fund following stock specific situations across financials, consumer staples and industrials. Click here to read the full Conservative Portfolio Update.

Defensive Portfolio Update

Portfolio performance was broadly flat in Q3. The best performing funds in the Portfolio were the Diversified Bond fund, which benefitted from low interest rates and narrowing credit spreads, and the Worldwide Opportunities fund, which kept pace with the continued momentum in international equity markets. The worst performing fund, and biggest detractor from returns was the UK Absolute Return fund following stock specific situations across financials, consumer staples and industrials. Click here to read the full Defensive Portfolio Update.

Deferred Income Portfolio

The Portfolio fell in value during the third quarter. The top performer was the Strategic Income fund, which benefitted from the strong performance of high yield credit markets. The main detractors, and the reason the Portfolio value declined, was the allocation to UK income funds, which were hit by both dividend stocks remaining out of favour, and the underperformance of the UK market. The exposure to this part of the market was reduced in September following the removal of the UK Equity fund. Click here to read the full Deferred Income Portfolio Update.

Immediate Income Portfolio

The Portfolio performed well during the third quarter. The corporate bond funds produced the strongest returns as interest rates remained low and credit spreads narrowed, particularly in lower quality, high yield bonds. The worst performer, and biggest detractor from returns was the Property fund which realised 6 months of performance following the unsuspension in September, reflecting reduced valuations in retail and leisure properties. Click here to read the full Immediate Income Portfolio Update.

Managed Funds Portfolio

The Portfolio performed well during the third quarter. The largest contribution to returns came from the Balanced Managed fund which benefitted from the ‘growth’ orientation of the equity strategy managed by Jennison, making up around 20% of the fund, and the emerging market tilt within the GMO dynamic multi asset strategy which makes up the remaining 80%. The biggest detractor in the Portfolio was the Global Value fund, which entered the Portfolio in late September, as ‘value’ style stocks remained out of favour. Click here to read the full Managed Funds Portfolio Update.

Strategic Growth Portfolio

The Portfolio performed strongly during the third quarter, helped by significant exposure to overseas equities and high yield corporate bonds. The largest contribution to returns came from the Global Growth fund which continued to benefit from the strong performance of ‘growth’ style stocks. The worst performing funds were the Japan and Global Value funds, as ‘value’ orientated stocks such as financials remained out of favour. The Global Value fund was added in September to provide a greater balance in the style exposure of the Portfolio. Click here to read the full Strategic Growth Portfolio Update.

 

The price of funds and the income from them may go down as well as up.  You may get back less than the amount invested.

Portfolio fund allocations are not rebalanced automatically. Thus Client Portfolios may not include all of the stocks mentioned in the commentary, as fund allocations may vary between clients, leading to different investment experiences.

The value of an investment with St. James’s Place will be directly linked to the performance of the funds selected and the value may fall as well as rise. You may get back less than the amount invested.


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