In May global share markets traded down due to fears associated with rising interest rates, elevated inflation, the uncertainty surrounding the war in the Ukraine and the possible net impact of these matters on global economic growth.
As noted in our recent update by our Investment Advisory Committee (IAC), we have not made any changes to our asset allocations and highlight the importance of remaining calm during times of market volatility.
May 2022 Performance Update
During May 2022 most asset classes declined, with the exception of the cash yield (AAA) and global listed infrastructure (IFRA) ETFs utilised in client portfolios. Six Park’s portfolios fell 1.3% to 2.6% over the month.
Global listed property (DJRE) was an outlier on the downside for May, as such assets can be very interest rate sensitive. DJRE had a relatively strong April, but was down more materially in May with rising rate concerns.
With the ASX200 now in “correction” territory (down 10% or more from recent highs) and the S&P500 in the US in “bear market” territory (down 20% or more from recent highs), we continue to stress the importance of riding out such market turmoil and the importance of portfolio diversification over time.
Watching the value of one’s investment portfolio go down is not pleasant, but history shows that markets do eventually recover.
Six Park Essential Portfolio Performance – May 2022
| Period | Conservative | Conservative Balanced | Balanced | Balanced Growth | Aggressive Growth |
| 1 month | -1.3% | -1.6% | -2.0% | -2.4% | -2.6% |
| 3 months | -1.3% | -1.0% | -1.0% | -1.2% | -0.6% |
| 1 year | -0.9% | -0.2% | 0.2% | 0.4% | 1.6% |
| 3 years | 1.7% | 3.2% | 4.9% | 6.0% | 7.0% |
| 5 years | 2.6% | 4.1% | 5.7% | 6.7% | 7.5% |
Notes:
(1) Past performance is not indicative of future performance.
(2) All figures are illustrative in nature based on notional $50,000 portfolios which are assumed to have been fully invested at the start of the relevant period. Your actual investment performance may vary depending on factors such as the timing of your investment with us.
(3) All figures are pre-tax but net of Six Park’s and applicable ETF fees. The results are based on closing prices for each ETF, not NAV. They assume dividend reinvestment (at month end) but do not include dividend imputation, cash holdings or annual rebalances.
(4) 1 and 3-year returns are annualised
Asset class performance
Global listed infrastructure (IFRA) and cash yields (AAA) had positive returns for the month of May.
International shares (VGS, VGAD) and the ASX200 (STW) fell in May, with growth stocks continuing to fall in the face of rising interest rates and concerns about a possible slowing of global economic conditions.
Fixed income (IAF) and Emerging Markets (VGE) fell less materially due to concerns about faster rising interest rates.
Global listed property (DJRE) also fell as noted above.
Read more about Six Park’s selected ETFs.
Notes
(1) Results reflect ETF closing prices, not NAV, so may differ from those published by the ETF issuers.
(2) Results reflect asset class performance for ETFs used in Essential portfolios. Performance for sustainable ETFs is broadly in line with the results shown.
Six Park Sustainable Portfolio Performance – May 2022
Our Sustainable portfolios are currently behind our Essential portfolios due to their higher exposure to tech companies/growth stocks which have underperformed over the past year.
It’s important to note that our Sustainable portfolios are designed to perform in line with our Essential portfolios but, over time, there will be periods of slight outperformance and underperformance.
| Period | Conservative | Conservative Balanced | Balanced | Balanced Growth | Aggressive Growth |
| 1 month | -1.5% | -1.9% | -2.5% | -3.0% | -3.4% |
| 3 months | -1.5% | -1.4% | -1.5% | -1.7% | -1.2% |
| 1 year | -1.7% | -1.4% | -1.1% | -0.9% | 0.1% |
Notes:
(1) Past performance is not indicative of future performance.
(2) All figures are illustrative in nature based on notional $50,000 portfolios which are assumed to have been fully invested at the start of the relevant period. Your actual investment performance may vary depending on factors such as the timing of your investment with us.
(3) All figures are pre-tax but net of Six Park’s and applicable ETF fees. The results are based on closing prices for each ETF, not NAV. They assume dividend reinvestment (at month end) but do not include dividend imputation, cash holdings or annual rebalances.
Investment Advisory Committee Market Commentary
If you are feeling concerned about your investments during this period of market volatility we recommend you read our recent IAC comments for further insights.