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Investment Objective and Strategy

Objective and Strategy: The portfolio aims to achieve returns in excess of UK CPI + 3% p.a. over rolling three year periods. Over any three year rolling period the portfolio should always deliver a positive return. Portfolio returns will be generated through  interest income, dividend income and capital growth. The portfolio benchmark is the EAA Fund GBP Cautious Allocation category. The portfolio is a  multi-manager portfolio ideally comprising at least two underlying funds and not more than six. Fund selection will be bias towards high Sortino ratios, low downside standard deviation and to managers and funds that have successfully navigated sustained negative market conditions. Where possible underlying funds will be given as many of the asset allocation decisions as possible. Underlying investments will be held in multiple first world currencies, however, all performance and risk statistics will be in GBP.

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Cumulative Growth Since Inception (GBP)

Trailing Returns (GBP)

Risk Measures

Risk Metrics IZA Global
Stable Model Portfolio
Standard Deviation* 6.88 6.96
Sharpe Ratio* 1.05 0.56
Sortino Ratio* 0.67 0.31


Periodic Returns (GBP)

Period Iza Global Stable Portfolio Benchmark UK CPI +3%
1 Month 1.80 1.50
3 Months 1.34 0.99
6 Months 0.51 0.41
YTD 3.28 3.61
1 Year -0.78 0.27
3 Years -0.17 2.42
5 Years 1.76 1.70

Asset Allocation

Monthly Portfolio Net Returns (GBP)

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec YTD B-Mark UK CPI + 3%
2023 2.77 -0.76 -0.53 0.51 -0.46 0.01 1.80 3.28 3.61
2022 -5.71 -2.58 1.21 -2.98 -2.63 -4.04 4.97 -1.97 -4.41 0.73 2.51 -0.65 -14.96 -10.62 13.71
2021 -0.25 -1.64 0.58 2.53 -0.45 1.90 0.55 1.00 -0.50 0.70 0.20 -0.38 4.25 2.34 8.30
2020 0.58 -3.22 -5.41 4.99 2.65 1.52 0.84 1.96 0.49 -0.74 3.30 2.24 9.11 4.09 3.59
2019 2.5 1.7 2.4 1.3 -0.6 2.2 2.27 -0,67 -0.66 -0.73 1.15 0.25 11.59 8.34 4.30
2018 0.1 -0.5 -1.6 1.4 1.7 0.6 1.3 0.8 -0.6 -2.7 0.4 -3.1 -2.4 -2.75 5.10


Global financial markets performed well in June 2023 as the disinflation trend continued in many parts of the globe due to the easing of food and commodity prices. Furthermore, market sentiment was supported by the optimism of central banks nearing the end of their monetary policy tightening campaigns and the news that the US has reached an agreement to raise the debt ceiling, thereby avoiding default. The S&P 500 gained 6.61% (USD) in June. S&P 500 breadth turned strongly positive in June, as 454 issues were up (with 155 up at least 10%), compared with May’s 124 gainers, which has turned the YTD breadth positive, with 300 up (116 up at least 20%), as all 11 sectors were positive for the month. The dominance of the high-market-value stocks still exists, as the index’s total return was up 16.89% (USD) YTD, but without the top 44 stocks, the index would be negative YTD. The Iza Global Stable Portfolio gained 0,01% (GBP) in June. Since the beginning of the year, the portfolio has gained 1.45% (GBP). The advance came amid moderating inflation and signs that the US economy remains resilient in spite of higher interest rates. A revision to Q1 GDP growth indicated expansion of 2% (annualised), substantially more than the previous estimate of 1.3% growth. Consumer confidence increased to its highest level since the start of 2022, which could be attributed to the resilient labour market and softening inflation. The unemployment rate (May) remains near generational lows, and the latest reading showed increasing residential construction payrolls. Inflation is softening, as evidenced by core CPI and PPI; however, the Fed’s preferred measure, core PCE, has remained elevated. The Federal Reserve (Fed) raised interest rates by 25 basis points (bps) in May. However, it did not hike rates in June, adopting what economists have termed a “hawkish pause”. The “dot plot” of rate predictions indicated two further rate rises in 2023. Markets are locking in a rate hike at the upcoming July meeting with 40% odds for an additional quarter-point hike to follow. US inflation (as measured by CPI) declined to 0.1% (month-on-month) in May, easing from a 0.4% increase in April amid a continued decline in the cost of energy. This brought down the annual rate to 4.0%, below expectations of 4.1%. The economy more broadly remains in good health. The US unemployment rate increased in May to 3.7% from 3.4%, a larger than expected move but the labour market nonetheless remains historically tight. Markets are seemingly pricing in a more optimistic economic outlook than what many media and market pundits have been reporting and forecasting. Record index performance, improving market breadth, new highs in industrials and homebuilders, resilient economic data, softening inflation, improving 2H corporate earnings, and an AI revolution may combined suggest that one of the most widely anticipated recessions may not be in the cards this year after all. Looking at the underlying holdings we find that the Iza Global Balanced Fund was the portfolio’s largest contributor for June gaining 0,75%. The portfolio’s largest detractor was the Invesco Sterling Bond Fund which declined by -0,94% for the month. The Royal London Sterling Extra Yield Bond fund declined by 0,81% and the Rubrics Global Credit Fund declined by 0,47% for the month.

Returns are based on the strategic underlying weightings of the funds and will not exactly reflect individual client returns. All returns are net of fund management fees, but exclude advice and administration fees. Prior to portfolio launch date, the performance is pro-forma using the actual underlying fund performances and is net of all fees and expenses.

*The performance information is based on the back-tested performance of hypothetical investments over the time periods indicated. “Back-testing” is a process of objec-tively simulating historical investment returns by applying a set of rules for buying and selling securities, and other assets, backward in time, testing those rules, and hypo-thetically investing in the securities and other assets that are chosen. Back-testing is designed to allow investors to understand and evaluate certain strategies by seeing how they would have performed hypothetically during certain time periods. While back-testing results reflect rigorous application of the investment strategy selected, back-tested results have certain limitations and should not be considered indica-tive of future results. The results achieved in our simulations do not guarantee future investment results.

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