October was a mixed month for investors. While international equities fell amid rising COVID-19 infections across the northern hemisphere and uncertainty over the upcoming US presidential election, emerging markets and Australian shares bucked the trend to record solid gains.
The Six Park portfolios were broadly flat for the month, returning -0.1% to +0.3%. On a rolling 12-month basis, our returns are -3.3% to -5.6%, broadly unchanged from last month and still well ahead of the ASX200, which is down -8.2% over the same period. On a three-year basis, our portfolios have returned +2.1% to +4.6% per annum. This represents a gross gain of +6.4% to +14.6% after fees.
Six Park Portfolio Performance – October 2020
|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
Emerging market stocks were the standout performer in October, gaining +4.5%. Performances were mixed across our other asset classes, with Australian shares, fixed income and cash yield registering gains and international shares, global property and infrastructure falling back. Read more about Six Park’s selected ETFs.
(1) Results reflect ETF closing prices, not NAV, so may differ from those published by the ETF issuers.
Emerging markets surged +4.5% in October. Chinese stocks were the main contributor, buoyed by rising hopes of more stable US trade relations under a potential Biden presidency and stronger than expected Q3 earnings releases, particularly amongst technology companies. Taiwan, India and Korea (which collectively comprise over 32% of our chosen ETF) also advanced, boosted by falling COVID-19 case numbers (particularly in India) and an improving economic sentiment.
Australian shares outperformed their global peers, rising +1.8%. over the month. The local market was supported by a stimulatory Federal budget, an easing of lockdown restrictions in Victoria and expectations of an early November interest rate cut by the RBA. 14 of the ASX’s 22 sub-industry sectors posted gains led by the household and personal products segment which was up +11.4% for the month.
The fixed income and cash yield sectors eked out small gains, rising +0.3% and +0.1% respectively on the back of expectations of a likely easing in rates by the Reserve Bank in November.
Infrastructure stocks were down slightly for the month (-0.4%), with rises across electricity providers offset by falls across transport and railroad stocks.
Hedged international shares fell -1.7% in October. US markets were dragged down by uncertainty over the presidential election, rising COVID-19 infection rates and poor progress in congressional negotiations over a pandemic aid stimulus package. European markets were also weaker as COVID-19 infections increased sharply and several countries reintroduced lockdown measures. Unhedged international shares fared slightly better over the month as a result of the AUD’s 1% depreciation against the USD but still ended the month down -0.7%.
Global property chalked up another poor month, falling -1.7% as a surge in coronavirus cases across the Northern Hemisphere weakened investor sentiment.