MyFolio Multi-Manager Income V Fund

Transcription

1 Q MyFolio Multi-Manager Income V Fund 31 March 2017 The fund aims to provide an income-focused return with some capital appreciation over the longer term, investing mainly in a range of collective investment schemes from selected managers to achieve a broad exposure to diversified investments, including equities, absolute returns, fixed and variable rate interest bearing securities and immoveable property. The fund may also invest in transferable securities, money market instruments, deposits and cash. The investment managers are selected for their investment expertise and are monitored on an ongoing basis. This selection and ongoing monitoring is currently undertaken by Standard Life Investments and is based on extensive research with the aim of blending managers with expertise across the chosen asset classes. Typically, the fund will have high exposure to assets providing potential for growth, such as equities. Past performance is not a guide to future returns and future returns are not guaranteed. The price of assets and the income from them may go down as well as up and cannot be guaranteed; an investor may receive back less than their original investment. The fund may use derivatives to reduce risk or cost, or to generate additional capital or income at low risk. Usage of derivatives is monitored to ensure that the fund is not exposed to excessive or unintended risks. The value of assets held within the fund may rise and fall as a result of exchange rate fluctuations. OEIC Fund Multi-Asset Fund of Funds Quarterly Fund Manager Bambos Hambi Fund Manager Start 16 Dec 2011 Launch Date 16 Dec 2011 Current Fund Size 5.4m Base Currency GBP This document is intended for use by individuals who are familiar with investment terminology. To help you understand this fund and for a full explanation of specific risks and the overall risk profile of this fund and the shareclasses within it, please refer to the Key Investor Information Documents and Prospectus which are available on our website Standard Life Investments has not considered the suitability of investment against your individual needs and risk tolerance. If you are in any doubt as to whether this fund is suitable for you, you should seek advice. An adviser is likely to charge for advice. We are unable to provide investment advice. Please note that the number contained in the fund name is not related to the synthetic risk and reward indicator contained in the Key Investor Information Document (KIID). Fund Information * Composition by Fund Exposure Fund % Fund % JPM US Equity Income 13.0 Majedie UK Income 4.7 Invesco Perpetual European Equity Income 9.8 Neuberger Berman EM Debt Local Currency 3.6 SLI Global Absolute Return Strategies 8.8 Invesco Perpetual Global Targeted Returns 3.4 Threadneedle US Equity Income 8.6 Nomura US High Yield Bond 2.2 Threadneedle Investment UK Equity Income 8.5 AQR Systematic Total Return 2.1 Artemis Income 7.8 Henderson UK Property 1.6 CF Morant Wright Nippon Yield 7.0 Cash and Other 1.3 TM Fulcrum Diversified Core Absolute Return 5.3 L&G Global Real Estate 1.1 Charlemagne Magna Emerging Markets Dividend 5.2 M&G Property Portfolio 0.7 Schroder Asian Income 4.8 Threadneedle Investment High Yield Bond 0.5 Tactical Asset Allocation The table below shows the tactical asset allocation of each asset class relative to the strategic asset allocation position. Asset Class Underweight % Strategic asset % Overweight % Cash & Other Sterling Corporate Bonds UK Equities US Equities European Equities Japan Equities Asia Pacific Equities Emerging Market Equities Sterling Hedged Global High Yield UK Property Global Real Estate Emerging Market Debt Absolute Returns Portfolios not re-balanced daily. Due to market fluctuations the Fund Composition may vary from the Tactical Asset Allocation.

2 Fund Performance * Price Indexed The performance of the fund has been calculated over the stated period using bid to bid basis for a UK basic rate tax payer. The performance shown is based on an Annual Management Charge (AMC) of 0.48%. You may be investing in another shareclass with a higher AMC. The charges for different share classes are shown on the next page. For details of your actual charges please contact your financial adviser or refer to the product documentation. Source: Standard Life Investments (Fund) Mar-12 Sep-12 Mar-13 Sep-13 Mar-14 Sep-14 Mar-15 Sep-15 Mar-16 Sep-16 Mar-17 MyFolio Multi-Manager Income V Year on Year Performance Source: Standard Life Investments (Fund) 31/03/2017 (%) 31/03/2016 (%) 31/03/2015 (%) 31/03/2014 (%) 31/03/2013 (%) Retail Fund Performance Institutional Fund Performance Platform One n/a Cumulative Performance Source: Standard Life Investments (Fund) 6 Months (%) 1 Year (%) 3 Years (%) 5 Years (%) Retail Fund Performance Institutional Fund Performance Platform One n/a Note: Past Performance is not a guide to future performance. The price of shares and the income from them may go down as well as up and cannot be guaranteed; an investor may receive back less than their original investment. For full details of the fund's objective, policy, investment and borrowing powers and details of the risks investors need to be aware of, please refer to the prospectus. For a full description of those eligible to invest in each share class please refer to the relevant prospectus. Definitions Cash and Other - may include bank and building society deposits, other money market instruments such as Certificates of Deposits (CDs), Floating Rate Notes (FRNs) including Asset Backed Securities (ABSs), Money Market Funds and allowances for tax, dividends and interest due if appropriate.

3 Quarterly Commentary Environment Global equities delivered robust returns in the first quarter of 2017, albeit slowing in March, on hopes that US President Trump s proposed policies would boost economic growth and lift corporate profits. As expected, the US Federal Reserve (Fed) increased interest rates. A relatively upbeat fourth-quarter results season, renewed merger and acquisition activity and growing optimism about global economic growth were also supportive. European stock markets were boosted by signs that the region s economy was improving. Business surveys hit a five-year high and consumer confidence rose too. Japanese shares were affected by worries about a change in US trade policy. The yen was stronger too, so Japanese exports were less competitive. Japanese economic, wage and company earnings data were fairly positive, however. Other Asian stocks were boosted by China s improving economy, which helps their exports. Emerging market stock markets performed well overall. Optimism surrounding Mr. Trump s election faded, and US government bond yields declined (bond prices rose) as investors sought more defensive assets. Yields on UK government bonds also fell as investors considered the downside risks related to Brexit. Global corporate bonds rallied on the improving economic backdrop. While credit investors accepted that a stronger economy meant rising interest rates, robust corporate balance sheets were deemed positive. However, optimism over global growth subsequently lessened, leaving credit slightly weaker near quarter-end. UK commercial real estate made a robust start to Having fallen in 2016, UK real estate capital values turned positive, up 0.4% in January and February 2017, according to the MSCI/IPD monthly index. Sterling weakness attracted overseas investors into the asset class. Activity We review the Strategic Asset Allocation (SAA) for each of the MyFolio funds every quarter, with the aim of ensuring that we continue to meet investors long-term interests. Following the most recent review, we made no changes to the SAA model. During the quarter, we increased exposure towards asset classes that should benefit from the improvements in global growth and the rise in inflation that we expect to see. We therefore made the following Tactical Asset Allocation (TAA) changes. Reduced our UK equities position because we prefer other global equity markets to the UK, given the uncertain outlook for the UK economy and the headwinds it continues to face after the signing of Article 50. Decreased our US equities position while still remaining overweight (versus our SAA), we preferred to allocated to other equity markets where we believe growth momentum is more favourable. Increased our overweight holding in Japanese equities this market should be more sensitive to the upturn in global growth. It also has the added diversifying benefit of being exposed to the defensive characteristics of the yen. Increased our exposure to Asia ex- Japan equities intra-regional trade in Asia is growing, reducing its reliance on the US, as the region slowly acclimatises to an evolving Chinese economy. We remain underweight (versus our SAA). Increased our holding in European equities as we are increasingly positive on more cyclical growth markets, we moved from an underweight allocation to an overweight allocation relative to the SAA. Increased our position in emerging market equities as we are increasingly positive on more cyclical growth markets, we moved from an underweight allocation to an overweight allocation relative to the SAA. Furthermore, valuations remain attractive. Reduced our exposure to emerging market debt we further reduced our holdings at a point when yields were close to the bottom of their post-us election range. We remain slightly overweight versus the SAA. Further reduced our exposure to UK direct commercial real estate we continue to remain underweight in order to fund more attractive equity positions. In terms of the underlying funds, we: Bought the AQR Systematic Total Return Fund Bought the Invesco Perpetual Global Targeted Returns Fund Increased the Artemis Income Fund Sold the CF Liontrust Macro Equity Income Fund Reduced the Standard Life Investments GARS Fund We reduced the holding in the Standard Life Investments GARS Fund and added holdings in the AQR Systematic Total Return Fund and in the Invesco Perpetual Global Targeted Returns Fund. This was in line with our objective for the MyFolio Multi- Manager range of combining a number of the best managers across asset classes to provide diversification. After adding the Fulcrum Diversified Core Absolute Return Fund in 2016, we are continuing to broaden our spread of holdings to be consistent with our mandate provided our quality threshold is met. Within equity income, we sold the CF Liontrust Macro Equity Income Fund, where we had less conviction following team changes, preferring to add to the Artemis Income Fund instead. We also made a number of alterations during the quarter to the weightings of the underlying funds because of changes in the TAA. Performance We experienced positive returns across the majority of asset classes over the period. The allocations to US equities, UK equities and European equities delivered the largest positive contribution to total returns. At a TAA level, the overweight position in US equities was a positive contributor to performance, though an underweight in Asia Pacific equities and emerging market equities versus the SAA detracted slightly from performance. At a fund level, the best-performing funds compared with their asset class benchmarks were the Invesco Perpetual Global Targeted Return Fund, the Threadneedle US Equity Income Fund and the Charlemagne Magna Emerging Markets Dividend Fund. The weakest performers versus their respective benchmarks were the Invesco Perpetual Equity Income Fund, the CF Morant Wright Nippon Yield Fund and the Majedie UK Income Fund. Outlook Global equity investors face a conundrum. On the one hand, the global economy is improving, with growth and trade picking up. The risk of deflation has fallen and central banks generally remain supportive, setting a positive scene for equity markets. On the other hand, policy and politics are creating uncertainty, with a lack of clarity on the outlook for US trade and tax, and upcoming European elections. As such, a modicum of caution is warranted when making investment decisions. While we expect bond yields to gradually increase (and bond prices to fall), challenges remain. Away from President Trump s policy challenges, the US economic backdrop remains

4 Quarterly Commentary favourable and the Fed seems prepared to respond with higher rates. Meanwhile, the European Central Bank is shifting towards reducing monetary support and unwinding negative interest rates. In the UK, higher inflation is proving awkward for the Bank of England if it wants to maintain interest rates at low levels. This very fluid environment for bonds requires us to take a pragmatic approach to new information. We expect returns from the UK commercial real estate market to moderate. The amount by which property values will fall hinges on the long-term economic impact of leaving the EU. Despite our more negative outlook, UK real estate remains attractive for those seeking a source of

5 Other Fund Information Retail Acc Retail Inc Institutional Acc Institutional Inc Lipper Bloomberg SLMMIN5 LN SLMI5RI LN SLMMVIA LN SLMI5II LN ISIN GB00B7088M00 GB00B783RF39 GB00B7874K91 GB00B7879H18 SEDOL B7088M0 B783RF3 B7874K9 B7879H1 Platform One Acc Platform One Inc Lipper Bloomberg SLM5P1A LN SLM5P1I LN ISIN GB00B7NZZP05 GB00B6SWTY68 SEDOL B7NZZP0 B6SWTY6 Interim Annual Reporting Dates 31 Dec 30 Jun XD Dates 30 Sep,31 Dec,31 Mar 30 Jun Payment Dates (Income) 31 Jul,31 Jan,30 Apr 31 Oct Valuation Point Type of Share ISA Option 7:30 am Income & Accumulation Yes Retail Institutional Platform One Initial Charge 4.00% 0.00% 0.00% Annual Management Charge 1.20% 0.48% 0.65% Ongoing Charges Figure 2.05% 1.40% 1.63% The Ongoing Charge Figure (OCF) is the overall cost shown as a percentage of the value of the assets of the Fund. It is made up of the Annual Management Charge (AMC) shown above and the other expenses taken from the Fund over the last annual reporting period. It does not include any initial charges or the cost of buying and selling stocks for the Fund. The OCF can help you compare the costs and expenses of different funds. *Any data contained herein which is attributed to a third party ("Third Party Data") is the property of (a) third party supplier(s) (the Owner ) and is licensed for use by Standard Life**. Third Party Data may not be copied or distributed. Third Party Data is provided as is and is not warranted to be accurate, complete or timely. To the extent permitted by applicable law, none of the Owner, Standard Life** or any other third party (including any third party involved in providing and/or compiling Third Party Data) shall have any liability for Third Party Data or for any use made of Third Party Data. Past performance is no guarantee of future results. Neither the Owner nor any other third party sponsors, endorses or promotes the fund or product to which Third Party Data relates. **Standard Life means the relevant member of the Standard Life group, being Standard Life plc together with its subsidiaries, subsidiary undertakings and associated companies (whether direct or indirect) from time to time. FTSE, "FT-SE ", "Footsie ", [ FTSE4Good and techmark] are trade marks jointly owned by the London Stock Exchange Plc and The Financial Times Limited and are used by FTSE International Limited ( FTSE ) under licence. [ All-World, All- Share and All-Small are trade marks of FTSE.] The Fund is not in any way sponsored, endorsed, sold or promoted by FTSE International Limited ( FTSE ), by the London Stock Exchange Plc (the Exchange ), Euronext N.V. ( Euronext ), The Financial Times Limited ( FT ), European Public Real Estate Association ( EPRA ) or the National Association of Real Estate Investment Trusts ( NAREIT ) (together the Licensor Parties ) and none of the Licensor Parties make any warranty or representation whatsoever, expressly or impliedly, either as to the results to be obtained from the use of the FTSE EPRA NAREIT Developed Index (the Index ) and/or the figure at which the said Index stands at any particular time on any particular day or otherwise. The Index is compiled and calculated by FTSE. However, none of the Licensor Parties shall be liable (whether in negligence or otherwise) to any person for any error in the Index and none of the Licensor Parties shall be under any obligation to advise any person of any error therein. FTSE is a trade mark of the Exchange and the FT, NAREIT is a trade mark of the National Association of Real Estate Investment Trusts and EPRA is a trade mark of EPRA and all are used by FTSE under licence. Useful numbers - Investor Services Call charges will vary. Standard Life Investments Limited is registered in Scotland (SC123321) at 1 George Street, Edinburgh EH2 2LL. Standard Life Investments Limited is authorised and regulated by the Financial Conduct Authority. Calls may be monitored and/or recorded to protect both you and us and help with our training Standard Life INVRT XGXD