Market & Portfolio Update – August 2019
Market & Portfolio Update – August 2019
After good gains so far this year, diversified portfolios produced a relatively flat return for August, but looking below the surface there was a bit more going on. Global share markets had a choppy month, finishing around 2% lower in August. However, the recent volatility was offset by a 5% fall in the NZ dollar, which lifted the value of overseas investments.
Fixed interest and listed property investments also performed well as interest rates fell around the world. Property companies, particularly in New Zealand, have been among the top performers over the past year. They are in somewhat of a sweet-spot with interest rates falling while economic growth remaining solid.
Combining all this together is a great illustration of the benefit in holding a diversified mix of investments. Most multi-sector portfolio posted positive returns for the month, with the more defensive portfolios leading the way having a larger portion of the overall portfolio in fixed interest holdings.
Disclaimer: This article has been prepared for the purpose of providing general information, without taking into consideration any particular investor’s objectives, financial situation or needs. Any opinions contained in it are held as at the report date and are subject to change without notice.
You’re sitting in your favourite restaurant, feeling famished. The waiter arrives and reads out a long list of mouth-watering specials. Yet the moment he walks away, you find you can recall only the last item on the list. Congratulations, you’ve been struck by the recency effect.
One of the most persistent debates in the investment industry is whether investors are better to use passive or active managed funds. With strong advocates on both sides of this debate, it may seem like an obscure discussion. However, for investors, long-term performance data tells a conspicuous story.