REBALANCING UPDATE: July 2019
Since the last rebalancing, during the period between April and July, all Fusion DFM portfolios outperformed their respective benchmarks, recording 4.3% to 4.8% positive performance. The outperformance was driven by both positive model asset class allocations and components/funds selection which well covered slight negative contributions from sub-benchmark (geographical) allocations. The latter was caused by disproportionately strong US returns. Asset allocation for the next quarter remains broadly the same, with slightly higher allocations towards Commodities at the expense of lower allocations to Development Government Bonds.
The model for Global Asset Allocation remains the same. New quantitative filters, with focus on better controlled downside, are added to improve asset/fund selection process. As a result, a number of components have been excluded from the portfolios, including small cap equity components and Syncona (substituted by iShares Infrastructure fund). New components were added in both Equities and Alternatives. Jupiter European Equity investment trust, after a very good run of +12% since last rebalance, was taken out in favour of less expensive, less leveraged and more transparent trackers.