by David Blumenthal July was generally a weaker month for investors, with returns dampened by the surging AUD and fears of rising interest rates. Overall, the Six Park portfolios were down -0.2% to ‑0.7% for the month. On a rolling 12-month basis, our portfolios are up +1.1% to +6.2%. These figures are lower than prior months due to the cumulative impact of (i) softer equity returns over the past quarter and (ii) the drop-off from the 12-month returns calculations of the unusually strong July 2016 results (which saw ASX200 gain almost 7% for the month).
| PERIOD | CONSERVATIVE | CONSERVATIVE BALANCED | BALANCED | BALANCED GROWTH | AGGRESSIVE GROWTH |
|---|---|---|---|---|---|
| 1 month | -0.2% | -0.4% | -0.5% | -0.7% | -0.7% |
| 3 months | 0.2% | -0.2% | -0.7% | -1.0% | -1.8% |
| 1 year | 1.1% | 2.1% | 3.7% | 4.7% | 6.2% |
Notes
(1) Past performance is not indicative of future performance.
(2) All figures are illustrative in nature based on notional, fully invested portfolios of $50,000. Your actual investment performance may vary depending on factors such as the timing of your investment with us.
(3) All figures are pre-tax, include an allowance for Six Park’s fees and are net of applicable ETF fees. The results are calculated using monthly published closing prices for each ETF, not NAV. They assume dividend reinvestment (at the end of each month for simplicity) but do not include any value for dividend imputation credits. No cash holdings or annual rebalances are assumed.
ASSET CLASS PERFORMANCE
The emerging market segment was the strongest asset class for the month. Returns across all other asset classes were largely flat or slightly down.
- Emerging markets were up +1.6% for the month, buoyed by better than forecast China GDP figures and improvements in commodity prices.
- Returns across our bank deposit and bond ETFs were slightly positive but subdued, reflecting the prevailing low interest rate environment, and in the case of the local bond markets, expectations of rising interest rates (explained more here).
- Australian shares were largely flat, with slight gains across the materials and financial sectors offset by weakness in the telecommunication and healthcare segments.
- Infrastructure stocks were generally lower, with ongoing political gridlock in the US fuelling further doubts over the likelihood of Trump’s stated infrastructure spending plans.
- International shares and listed property were down -1.6% and -1.8% for the month. Although US and UK markets were strong (boosted by upbeat economic data and earnings), overall returns were pushed down by the 4.2% rise in the AUD (which reduced the value of these overseas holdings in Australian dollar terms).