OVERVIEW
August was a positive month for markets in spite of rising geopolitical tensions across the world. The UK market put on 2.0% and globally positive sentiment encouraged the US market to scale all-time highs, whilst Europe enjoyed a rise following action by the ECB.
In Asia markets were buoyed by decent economic data coming from China.
Fixed income investments enjoyed strong gains as the low interest-rate environment looked set to continue for a while longer.
Commercial property in the city is now enjoying boom conditions and the market is strong throughout the UK, so all funds made good progress in August.
Here is the chart of the FTSE 100 index for the last six months;
…and the last five years, which puts this into perspective;
FUND PERFORMANCE
Here follow tables showing the performance of the portfolios over various periods of time to the end of August;
Short-term Performance
| Parmenion Portfolio/Index | One monthPerformance to 31 August 2014 | One year performance to 31 August 2014 |
| Income Portfolio | +1.7% | +10.6% |
| Average Mixed Investment fund (20-60% shares) | +1.2% | +6.9% |
| Balanced Portfolio | +2.1% | +10.7% |
| Average Mixed Investment fund (40-85% shares) | +1.6% | +7.8% |
| Tactical Portfolio | +2.4% | +12.5% |
| Average Flexible Investment Fund | +1.6% | +8.0% |
| MSCI UK | +2.0% | +10.0% |
| MSCI World (£) | +4.0% | +13.0% |
| IBOX Gilt | +3.5% | +7.4% |
Long-term Performance
| Parmenion Portfolio/Index | Three year performance 31 August 2014 | Five year performance to 31 August 2014 |
| Income Portfolio | +35.4% | +60.1% |
| Average Mixed Investment fund (20-60% shares) | +23.7% | +37.2% |
| Balanced Portfolio | +33.7% | +59.3% |
| Average Mixed Investment fund (40-85% shares) | +31.7% | +47.3% |
| Tactical Portfolio | +34.0% | +61.2% |
| Average Flexible Investment Fund | +29.8% | +47.6% |
| MSCI UK | +41.4% | +65.7% |
| MSCI World (£) | +51.9% | +76.6% |
| IBOX Gilt | +16.2% | +31.3% |
(Source; Parmenion Capital Partners LLP)
PORTFOLIO REVIEW
All Portfolios
All portfolios produced good returns as world markets enjoyed strong gains along with all asset types. Investors seemed to shrug off concerns relating to the various geopolitical tensions round the world.
No changes were made to any of the portfolios in August.
Income Portfolio
The Income portfolio gained 1.7% in August, out-performing its benchmark (the average mixed investment (20-60% shares) fund) which gained 1.2%.
All investments performed well this month, with the US and Asian markets leading the way.
Balanced Portfolio
The Balanced portfolio gained +2.1% out-performing its benchmark (the average mixed investment (40-80% shares) fund) which increased by 1.6%.
All investments performed well this month, with the Asian markets leading the way.
Tactical Portfolio
The Tactical portfolio gained 2.4% in August, growing in-line with its benchmark (the average flexible fund) which also grew by +1.6%.
Our focus on Asian and US equities boosted performance along with strong returns from our European facing commercial property investment.
OUTLOOK
We are a little worried by the fact that the world seems to be full of troubles but that investors seem to shrug off this fact and markets continue to push ahead. This may reflect some complacency and possibly the fact that there is a huge weight of money searching for a home, as investors struggle to find investments that are capable of generating a reasonable yield.
We are about to trim equity positions adding further to commercial property in order to increase participation in the booming London commercial property market and benefit from the increased strength of the property market round the UK.
