June proved to be another strong month for markets, with continued investor optimism pushing European and US markets to record highs.
The Six Park portfolios once again registered solid gains for the month, rising between +1.0% and +2.8%. Over the financial year, our portfolios delivered returns of between +8.6% to +25.2%, strong rewards for those investors who stayed the course with their investment strategies following sharp market oscillations in the first half of 2020.
Over the past five years, our portfolios have now returned between +3.6% and +10.4% per annum. This equates to gross gains of +18.1% to +55.4% over the period (after fees). These solid returns highlight the benefits of our emphasis on low cost, diversified investing.
Six Park Portfolio Performance – June 2021
|Period||Conservative||Conservative Balanced||Balanced||Balanced Growth||Aggressive Growth|
(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
Almost all asset classes posted positive returns in June. Global shares, property and emerging markets were especially strong.
(1) Results reflect ETF closing prices, not NAV, so may differ from those published by the ETF issuers.
International shares (unhedged) surged +4.5% in June, aided partly by a -2.7% depreciation in the AUD against the USD. European equities were a standout, hitting record highs on the back of better-than-expected corporate earnings, solid vaccine rollout progress and falling coronavirus infections. US markets were also strong, aided by comments from the Federal Reserve that the recent rise in inflation would prove transitory and news that President Biden had secured bipartisan support for his US$1.2 trillion infrastructure spending package. Meanwhile, Japanese shares underperformed, held back by rising coronavirus concerns and weaker than expected industrial figures. Hedged international equities rose a more modest +2.3% for the month (without the benefit of the AUD’s depreciation) but still ended the fiscal year up +37%, well ahead of the +29% gains on unhedged shares over the same period.
Global property chalked up similarly strong gains of +4.5%, with both European and US real estate stocks rallying on the back of the ongoing economic recovery, a flurry of merger and acquisition announcements and the depreciation in the AUD.
Emerging markets advanced +3.8%. While Chinese markets slipped back on signs of slowing factory activity, most other emerging markets gained strongly on the back of rising commodity prices, and in particular crude oil, which hit 2-year highs as a result of a resurgence in global demand and OPEC+ supply restrictions.
Australian shares chalked up their 9th consecutive month of positive returns, rising +2.2% in June. Almost all sectors of the ASX200 recorded gains, led by the IT and consumer discretionary stocks, which gained +13.5% and +5.6% respectively. Over the fiscal year, Australian shares gained almost +28%, their strongest performance since 2006, but still lagged their global counterparts.
Fixed income added 0.5% for the month, with the market benefiting slightly from confirmation that the RBA intends to maintain its expansionary policies in place for some time yet. Returns on our cash yield ETF remained marginally positive (+0.03%) reflecting the ongoing low-interest rate environment.
Infrastructure stocks were down marginally in June (-0.1%). This headline return masked a range of divergent sub-sector performances, with pipeline stocks and infrastructure REITs (which represent a combined 20% of our chosen ETF) registering strong gains of +6% and +9% respectively, electricity stocks (32% of the portfolio) ending the month flat and transportation stocks (21% of the portfolio) closing down -1%.