SMA Strategic 70 Quarterly Report

Transcription

1 SMA Strategic 70 Quarterly Report As of 31/12/2018 Fourth quarter 2018 Global equity markets experienced one of their worst quarters since the Global Financial Crisis while cash and bonds made a comeback after a decade of ultra-low returns. Trump s trade war agenda with China, coupled with rising interest rates in the United States (US) and political turmoil globally formed layers upon layers of uncertainty for investors resulting in a mass movement towards defensive securities with more predictable returns. The consequences of these market movements were devastating for equity returns and investor confidence. Few Australian portfolios walked away unscathed. Pleasingly, your model portfolio stood strong during this period of heightened volatility. While the quarterly return is negative, it was one of the best performing portfolios in Australia within its respective universe of providers in Morningstar, a global data provider. The key positioning imbedded in your portfolio ensured capital was preserved keeping losses to a minimum. Your international equity fund managers, Antipodes and Stewart Investors, have biases for Europe, Asia and emerging markets with minimal exposure to US shares which contributed to the resilience of your portfolio as US shares experienced their worst performing December since the Great Depression in the 1930s. Additionally, having suffered poor performance since January, the RARE Emerging Markets Fund has made a comeback this quarter for two reasons. Firstly, investors substituted equities for infrastructure assets due to its defensive qualities by maintaining value during down market periods. Secondly, the uncertainty surrounding the trade war and how it will affect company revenues in emerging markets is not as damaging to the longevity of infrastructure assets than corporate shares therefore we expect their improved performance to continue in the near future. While Australia s S&P/ASX 300 Index was the best performing developed global equity index for December, it wasn t enough to sufficiently recover from a tough quarter resulting in both Australian equity managers within your portfolio underperforming. However, due to our concerns surrounding the limited capacity for sustainable economic growth in Australia caused by severe household debt, a weakening housing market and rising mortgage rates, there is an active underweight to these Australian equity managers. Consequently the blow of their underperformance was minimised considerably through careful portfolio positioning. Justin McLaughlin Chief Investment Officer Jessica Schlosser Investment Analyst Sam Alaaeddin Investment Analyst

2 SMA Strategic 70 As of 31/12/2018 Portfolio objective The SMA Strategic 70 model is a portfolio of actively managed assets designed to achieve high returns over the long term. Performance^ Since inception (p.a.)** 2 years (p.a.) 1 year () 6 months () 3 months () 1 month () Total Return 5.6 Volatility 5.1 **Inception Date: 30/09/2015 Growth of $100 invested at inception ^ Time Period: 1/10/2015 to 31/12/ / / / / / / /2018 ^ Performance data is after fund manager fees, but before any other applicable fees or taxes and assumes the reinvestment of dividends. Past performance is not indicative of future performance. Due to the flexibility of rebalancing and variations between accounts, performance shown is indicative only and assumes rebalancing occurs at the end of each calendar month, and also assumes that there are no deposits, withdrawals nor exceptions to regular rebalancing in the model portfolio. Return and risk vs. peer group Time Period: 1/01/2017 to 31/12/2018 Peer Group (5-95): Open End Funds - Australia - Multisector Growth Return () What is a risk and return chart? The chart to the left shows the returns and associated risk of the model portfolio (darker shape) against its peers (light grey circles), over the past year. The past years return (as a percentage) is shown on the vertical axis. The risk (as measured by the standard deviation) of the investment over the past year is shown on the horizontal axis. Risk Underlying funds APIR Code Global Broad Category Group Portfolio Weighting CFML Antipodes Global Fund CFML Fixed Interest CFML Schroder Equity Opportunities CFML Stewart Investors Worldwide CFML Cash CFML Colonial Infrastructure CFML RARE Emerging Markets Hyperion Australian Growth Companies CVW1890AU Equity NRM0030AU Fixed Income NRM0028AU Equity NRM0032AU Equity NRM0026AU Money Market NRM0036AU Equity 7.00 NRM0038AU Equity 6.00 BNT0003AU Equity 5.00 Page 1 of 4

3 SMA Strategic 70 Performance of current underlying funds 5 Yr (pa) 3 Yr (pa) 2 Yr (pa) 1 Yr () 6 Mth () 3 Mth () 1 Mth () CFML Antipodes Global Fund CFML Fixed Interest CFML Stewart Investors Worldwide CFML Schroder Equity Opportunities CFML Cash CFML Colonial Infrastructure CFML RARE Emerging Markets Hyperion Australian Growth Companies Please note: The CFML Antipodes Global Fund was established 8th May Asset class breakdown Cash 18.7 Australian Equities 18.7 Australian Fixed Interest 17.1 International Fixed Interest 2.8 International Equities 42.7 Equities: Market capitalisation Equities: Industry exposure Giant 31.5 Large 38.3 Mid 23.5 Small 4.5 Micro 2.2 Energy 6.0 Industrials 15.3 Consumer Staples 10.8 Financials 12.1 Communication Services 9.2 Utilities 10.1 Materials 8.9 Consumer Discretionary 7.0 Healthcare 9.3 Information Technology 9.9 Real Estate 1.4 Equities: Geographical exposure Fixed Interest: Credit quality North America 22.4 Latin America 2.8 United Kingdom 3.4 Europe developed 17.8 Europe emerging 0.6 Australasia 27.7 Japan 6.8 Asia developed 4.2 Asia emerging 14.3 AAA 40.0 AA 7.4 A 18.3 BBB 30.2 BB 2.6 B 0.6 Not Rated 0.8 Page 2 of 4

4 Top holdings of the underlying infrastructure, property and equity funds CFML Colonial Infrastructure - Top Holdings Sector Portfolio Weighting Transurban Group Dominion Energy Inc NextEra Energy Inc Kinder Morgan Inc P East Japan Railway Co TransCanada Corp Atlantia SpA Aena SME SA American Electric Power Co Inc Crown Castle International Corp Industrials 7.50 Utilities 7.07 Utilities 5.72 Energy 5.03 Industrials 4.93 Energy 4.91 Industrials 4.33 Industrials 4.30 Utilities 3.94 Real Estate 3.48 CFML Schroder Equity Opportunities - Top Holdings Sector Portfolio Weighting Commonwealth Bank of Australia Woolworths Group Ltd National Australia Bank Ltd BHP Group Ltd Fletcher Building Ltd Australia and New Zealand Banking Group Ltd Westpac Banking Corp Rio Tinto Ltd CYBG PLC DR Telstra Corp Ltd Financial Services 5.22 Consumer Defensive 5.06 Financial Services 4.38 Basic Materials 4.33 Basic Materials 4.25 Financial Services 3.80 Financial Services 3.72 Basic Materials 3.64 Financial Services 3.30 Communication Services 3.14 CFML Stewart Investors Worldwide S - Top Holdings Portfolio Date: 30/09/2018 Sector Portfolio Weighting Unilever PLC Henkel AG & Co KGaA Beiersdorf AG Merck KGaA Cerner Corp Waters Corp Ansys Inc Novo Nordisk A/S B Ain Holdings Inc Consumer Defensive 7.55 Consumer Defensive 5.36 Consumer Defensive 5.02 Healthcare 4.28 Technology 3.90 Healthcare 3.52 Technology 3.43 Healthcare 3.39 Consumer Defensive 3.38 Page 3 of 4

5 Top holdings of the underlying infrastructure, property and equity funds CFML RARE Emerging Markets - Top Holdings Sector Portfolio Weighting Malaysia Airports Holdings Bhd Gujarat State Petronet Ltd Bharti Infratel Ltd Mahanagar Gas Ltd China Gas Holdings Ltd China Everbright International Ltd China Merchants Port Holdings Co Ltd Container Corporation of India Ltd PT Jasa Marga (Persero) Tbk Class B Industrials 5.89 Utilities 5.69 Communication Services 5.50 Utilities 4.72 Utilities 4.25 Industrials 4.17 Industrials 4.10 Industrials 3.96 Industrials 3.92 Hyperion Australian Growth Companies - Top Holdings Sector Portfolio Weighting Seek Ltd REA Group Ltd Cochlear Ltd Domino's Pizza Enterprises Ltd Macquarie Group Ltd Trade Me Group Ltd Fisher & Paykel Healthcare Corp Ltd CSL Ltd IRESS Ltd Technology Technology 9.61 Healthcare 9.39 Consumer Cyclical 8.59 Financial Services 5.86 Technology 4.21 Healthcare 4.05 Healthcare 3.99 Technology 3.62 CFML Antipodes Global Fund - Top Holdings Sector Portfolio Weighting Cisco Systems Inc Electricite de France SA Technology 3.88 Utilities 3.88 Important Information In relation to the SMA, this document is issued by ClearView Financial Management Ltd (CFML) ABN AFSL as the Operator of ClearView Investments, an Investor Directed Portfolio Service. In relation to the IPS, this document is issued by ClearView Life Nominees Pty Ltd (CLN) ABN AFS as Trustee for the ClearView Retirement Plan ABN which includes ClearView Superannuation and Retirement Income, USI CLN and CFML together are referred to as ClearView. This document is not intended to represent investment or professional advice. This information does not take into account your individual objectives, financial circumstances or needs. You should assess whether the information is appropriate for you, having regard to your objectives, financial circumstances and needs. You should consider the disclosure documents when deciding whether or not to acquire or to continue to hold the investment. No representation or warranty is made as to the accuracy, completeness or reliability of any estimates, opinions, conclusions or other information contained in this document. This document may contain certain forward-looking statements. Forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors, many of which are beyond the control of ClearView. You should not place reliance on forward-looking statements. To the maximum extent permitted by law, ClearView and its related entities and each of their respective directors, officers and agents disclaims all liability and responsibility for any direct or indirect loss or damage which may be suffered as a result of relying on anything in this document including any forward-looking statements. Past performance is not an indication of future performance. Page 4 of 4