Sustainable Multi-Asset Fund Update – H1 2024
Tom Montagu-Pollock, Emilie Shaw and Matt Best provide an update on the Sustainable Multi-Asset Fund.
Authors
Global equity markets continued their positive run over the last three months, with the All Country World index up 2.9%, taking the return for the first half of the year to 12.5%. The return over the most recent quarter was driven predominantly by the US. Excitement about Artificial Intelligence (AI), alongside strong earnings growth from many of the “Magnificent Seven” and the broader technology sector, pushed markets higher. The Magnificent Seven alone accounted for more than 40% of the US stock market’s return over the last quarter. Over July they counted for more than 100% of the return, showing the influence these huge stocks continue to have.
Whilst it has been a positive period for equities, for fixed income investors it has been more challenging. UK gilt yields moved modestly higher, taking the return for the first half of the year to -2.5%.
Within alternatives, Commodities had a strong start to the year. As ever this marks divergence amongst the underlying assets. Industrial metals and gold continue to shine, while energy and agricultural commodities were softer. In terms of other alternatives, there was a narrowing of discounts within the investment trust space, which was beneficial to returns after a challenging period.
In terms of positioning, we remain neutral equities, balancing a peak in interest rates with expensive valuations vs. other asset classes. We remain positive on fixed income given elevated yields, with a preference for government bonds. Currently a less supportive environment for alternatives, but commodities continue to look attractive.
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This article is issued by Cazenove Capital which is part of the Schroders Group and a trading name of Schroder & Co. Limited, 1 London Wall Place, London EC2Y 5AU. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.
Nothing in this document should be deemed to constitute the provision of financial, investment or other professional advice in any way. Past performance is not a guide to future performance. The value of an investment and the income from it may go down as well as up and investors may not get back the amount originally invested.
This document may include forward-looking statements that are based upon our current opinions, expectations and projections. We undertake no obligation to update or revise any forward-looking statements. Actual results could differ materially from those anticipated in the forward-looking statements.
All data contained within this document is sourced from Cazenove Capital unless otherwise stated.