Overview: The Growth Engines portfolio fell 4.90% net of fees for the month of September.
The Growth Engines portfolio fell 4.90% net of fees for the month of September. The global growth backdrop continues to deteriorate on the back of persistent high inflation and even higher expected interest rates. Furthermore, the Russia/Ukraine situation is also making things worse. Developed market equities despite its correction year to date remains unattractive given this backdrop. One explanation could be the level of liquidity afforded to the market via quantitative easing over the last decade in the Western world leading to increased participation in the equities market. Chinese equities specifically remains very attractive but is also overshadowed by weak economic growth driven by the governments ongoing commitment to dynamic COVID-zero policies. Diversification in portfolios are critical in times like this.
Given this backdrop, the investment committee has decided to take a balanced approach between risk and return and hence maintain the portfolio. The IC believes 6% cash is appropriate for a growth portfolio and will await further opportunities to deploy capital.
While there are no strategy changes, there is one change to be made due to a successful fee negotiation relates to an alternative hedge fund which is in the portfolio that will be switched from the higher to lower fee version (22% discount). We continue to advocate for our investors and will negotiate fees on your behalf.
