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September Performance Update: Trends and Observations

Writer's picture: Tatyana MursalimovTatyana Mursalimov

We are pleased to continue our series of monthly updates on performance and risk data across a selection of multi-asset funds. We hope this update provides you with valuable insights into the current market conditions and fund performances.

We remain dedicated to assisting you in navigating these complexities to achieve your investment goals. For a deeper discussion on how these trends affect your specific portfolios, or to adjust your investment strategies, please do not hesitate to contact us.

As always, we welcome your feedback and are open to discussions about your specific investment needs.

 

SEPTEMBER HIGHLIGHTS


  • Macro Data: The Bank of England held interest rates at 5.0% in September, following its first rate cut in over four years in August. Many analysts expect further reductions at its next meeting in November. In response to weakening US employment data, the Federal Reserve commenced its rate-cutting cycle with a significant 50-bps reduction in September. With inflation cooling and economic activity subdued, the European Central Bank also delivered its second rate cut.


  • Market Returns: September ended with global equity markets broadly flat for sterling investors, while global fixed income markets were marginally lower. Despite this, investors contended with heightened volatility throughout the month. Geopolitical tensions escalated as hostilities in the Middle East spread to Lebanon, while the lack of clarity surrounding the upcoming US election continued to weigh on market sentiment. In such uncertain times, it is crucial to maintain a long-term perspective and avoid overreacting to short-term market fluctuations.


  • Longer-Term Trends: Over the past three months, most actively managed strategies outperformed their passive benchmarks, and have delivered returns comfortably above inflation over the last 12 months. However, on a rolling five-year basis, actively managed Growth and Diversified funds continue to lag behind both the CPI + 4% objective (frequently employed by charities) and a passive 70/30 equity/bond benchmark.


  • Fund Performance: In September, there was significant rotation between the top and bottom-performing funds from the previous month, with returns ranging from -1.2% to +2.2% across Growth and Diversified strategies. This variation highlights the importance of closely monitoring fund managers and understanding the factors driving performance. Market conditions can shift rapidly, causing certain sectors or strategies to outperform or underperform, which means it is crucial to ensure that the underlying drivers align with your long-term investment objectives.


  • Environmental, Social and Governance (ESG) Factors: We continue to monitor the ESG risks and product involvement of the funds in our universe. Many of these funds follow comprehensive ESG integration strategies, consistently achieving better scores than the broader market. We understand that ethical and sustainable investing is a priority for many of our clients, and we ensure these principles are embedded in the investment strategy while still aiming to deliver attractive financial returns.


If you are a Professional Investor, you may be interested to see our more detailed monthly information sheet, which provides useful insights and analyses for charity management teams and trustees, with a focus on long-term strategies and ESG considerations. Click the button below to access.




Disclaimer:

The information presented is intended for organisations and individuals with professional investment experience. Portfolio Manager Consultancy Ltd is committed to serving professional clients, ensuring our advice and insights align with the sophisticated needs of this group. We encourage those who do not have professional investment experience to seek advice before making any investment decisions based on this update. For a full understanding of our terms and the scope of our advice, please consult the disclaimer provided.

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Portfolio Manager Consultancy Ltd. is a company incorporated in England with company number 10777184 and a registered office at 100 Liverpool Street, London, EC2M 2AT.

 

Portfolio Manager Consultancy Ltd (FRN: 795030) is an appointed representative of Thornbridge Investment Management LLP (FRN: 713859) which is authorised and regulated by the Financial Conduct Authority.

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