Market commentary: Oct 2021
Portfolio performance
The last year was a game of two halves with the first six months providing over 80% of portfolio returns. Overall, virtually all client portfolio returns came from shares and property. Bond returns were negative over the year due to interest receipts being outweighed by falling bond values as interest rates rise. The current mood in share markets is one of optimism. In the US, strong company profit announcements are adding weight to this sentiment driving the share market to further record highs. It seems investors are not overly worried about the red flags of inflation, supply chain constraints, and an energy crunch weighing on economic growth.
Is our clients capital invested to move the world toward carbon zero?
World leaders are currently meeting in Glasgow for the COP 26 climate change conference. The aim is to get commitment to take action to reach net zero carbon emissions and limit global temperature rises to 1.5 degrees (compared to pre-industrial levels). As individuals it can feel challenging to make a difference in the face of massive global challenges like climate change. So, is our clients capital invested to help move the world toward carbon zero? The answer is yes! Here’s what our fund managers have to say…
Antipodes Global Fund
We look for resilient businesses at the right price. Decarbonisation is now a central pillar of policy across Europe, China and the US. and, in our view, a multi-decade investment cycle. We’ve got around 15% of our portfolio exposed to this.
Capital New Perspective Fund
Our experience and research indicate that a company taking a thoughtful and robust approach to carbon reduction is a positive indicator of sustainability and strategic thinking and that those factors will eventually be positively reflected in a company’s share price.
Magellan Global Fund
Magellan believes climate change is a particularly important environmental issue for global businesses and investors to consider. Research reports include a discussion of climate change related risks facing companies, including emissions intensity.
Nikko AM Global Shares Fund
We believe that attention to carbon reduction is about good investment discipline and is not a separate exercise. Instead, it is core to the business and inherent to long-term value creation.
Pathfinder Global Water Fund
Companies with a lower carbon intensity and a plan for managing the transition to a low carbon economy make better long-term investments.