by David Blumenthal February was a turbulent month for investors. Global equity markets started the month strongly, buoyed by progress on COVID-19 vaccination programs and US government stimulus measures, before falling back towards month-end on fears that a faster-than-expected economic recovery would force interest rates and inflation higher.
Performance across the Six Park portfolios was mixed (-0.5% to +0.8%) for the month, with our lower risk portfolios impacted most heavily by a decline in bond prices. On a rolling 12-month basis, our returns have now risen to -0.9% to +4.7%. Over three years, our portfolios have now returned +2.8% to +7.3% per annum. This equates to gains of +8.7% to 23.7% over the period (after fees).
Six Park Portfolio Performance – February 2021
| Period | Conservative | Conservative Balanced | Balanced | Balanced Growth | Aggressive Growth |
| 1 month | -0.5% | -0.2% | 0.0% | 0.3% | 0.8% |
| 3 months | -0.5% | -0.4% | 0.2% | 0.7% | 1.5% |
| 1 year | -0.9% | 0.6% | 2.4% | 3.2% | 4.7% |
| 3 years | 2.8% | 4.4% | 5.9% | 6.9% | 7.3% |
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 property was the standout asset class in February, gaining +3.4% for the month. Fixed income was the weakest, down -3.5%. 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.
Global property surged +3.4% in February. Gains were strongest among US real estate stocks, which outperformed as the so-called “re-opening trade” gathered momentum and vaccine rollouts raised expectations of a return to a more “normal” business environment later this year.
Hedged international equities rose +2.2% in February. While global markets were rattled towards month-end on fears that a faster-than-expected economic recovery would hasten interest rate rises, US and European stocks still ended the month in positive territory, buoyed by progress on COVID-19 vaccination programs and the prospect of further US government stimulus measures. Unhedged equities ended the month slightly down due to the AUD’s 2.5% rally against the USD.
Australian shares trailed their global counterparts but still ended the month up +1.5%, chalking up a fifth consecutive month of positive returns. Sector performances were mixed, with the strongest gains seen across mining and financial stocks. Just over half of all ASX200 companies who reported in February beat market expectations.
Infrastructure ended the month up +0.7%. Transportation services (23% of our chosen ETF) and railroads (7%) were the main contributors, both posting gains of over 5% for the month.
Returns on our cash yield ETF were once again positive but muted (+0.04%) for the month. This reflects the ongoing low-interest rate environment.
After posting strong gains in January, emerging markets finished in negative territory (down -0.6%) in February. Chinese stocks (which represent 43% of our chosen ETF) were particularly weak, driven by declines across technology and IT segments. Brazilian shares also touched four-month lows on concerns over how the local government was managing fuel prices and the banking sector. The rising AUD created further headwinds.
Fixed income fell -3.5% over the month. Most of this decline came in late February, when bond markets worldwide were rattled by fears that a faster-than-expected economic rebound would hasten a rise in inflation and interest rates. The accompanying rise in yields resulted in a sharp fall in local bond prices (given the inverse relationship between bond yields and prices).