Category: Investment returns

Phew.  The year’s over.  What an incredible twelve months. I made a big change in my portfolio in January and each month since it’s been a fascinating journey – at times nail-biting, at times frustrating and at times pinch-yourself good.

In this post I’m going to record the month’s performance before in the next post widening the view to 2016.

I didn’t notice any particularly market-relevant news this month.  The US market kept the gains it had delivered after the Trump election victory.  But the UK market decided to go on quite a tear, a so-called ‘Santa rally’ that continued throughout the month, with equities up 4.8% and reaching a record high – FTSE-100 closed up 5.8% at 7140.  Resource stocks rose sharply which provided a significant lift for the FTSE-100.  UK bonds rose slightly too, clawing back some of the Q3/Q4 falls.

Other equity markets rose too, with the European equity market up over 6% and the Australian market up 4%.  The US rise of 2% seems almost paltry by comparison.

Fixed income was essentially flat, outside the UK.

The US dollar continued its relentless rise, up 1.3% against the pound.  But the pound rose against the Ozzie.  Overall currency movements only affected my portfolio by 0.6%. By comparison the markets I’m in rose by 4.4%, weighted by my target allocation.

How did I perform compared to the averages in my markets?

Continue reading “My performance in Dec ’16 – Santa Rally” →

Trump won.  Already, less than a month in, it has a somewhat inevitable feel to it.  After Brexit I don’t think I can be shocked by politics any more, but from a market-watchers’ perspective the reverberations haven’t all been what I expected.

I had thought the USD would fall a bit.  It hasn’t.  Well, OK, it fell about 2.8% versus Sterling but it’s up against the Euro and the Aussie.

I had thought US equity markets would fall (from protectionism, policy freefall, etc) but in the shower the next morning the biggest driver seemed to be Trump’s seeming determination to reduce US corporation taxes to 15%; the subsequent market rally suggests I’m not the only person focusing on the impact this could have on equity valuations.

I hadn’t really thought about bonds.  But of course (hah! Ed.) with Trump suggesting a massive increase in the US fiscal deficit and national debt, along with a potential infrastructure boom, interest rates are on the way up.  The US bond indices fell almost 3% in the month, the third month in a row that bonds have fallen in the UK and the US.  UK bonds, which account for 20% of my target weighting, are down almost 9% since August; this alone has hit my portfolio by about 2% over the last three months. But let we become too fussed by end-of-the-bond-bubble chatter, bonds are still up during the year.

Continue reading “My performance in Nov ’16 – Trump!” →