Tuesday 31st January 2012
“Having spent a fair time waiting for what we believed to be an attractive position in the High Yield space we now feel the market has reached a sufficient point for entry. In addition, with this month’s Inflation figures likely to show a further easing of pressure, we wanted to ensure we were ahead of the curve in terms of a possible Index-Linked sell-off. Because of this we have replaced our Fixed Interest exposure in the Aggressive and Adventurous portfolio’s from the M&G Index Linked Fund to Kames High Yield. This has been a consistent top quartile fund for the past three years in discrete terms and gives us exposure to quality UK, Sub-Investment grade bonds, adding a bit more risk to the overall portfolio.

In the lower risk portfolios we have reverted back into the M&G Optimal Income Fund which lies within the Strategic Bond Sector, allowing the manager greater flexibility to invest across the whole bond universe”

6th January 2012
“Having felt sufficiently uncertain about making any changes to the portfolios for a short while we now believe some tweaking is appropriate to better position us for a satisfactory resolution to the European sovereign debt problem over 2012. Whilst this leaves fixed interest exposure where it currently stands or added to in the Balanced portfolio, we are increasing the Asian property exposure to a full weighting in appropriate portfolios. The manager of the Aviva fund is very confident further growth will occur over the short and medium terms.

The UK market is trading at a level that usually precedes a strong growth period and, whilst things may be different this time, by concentrating on companies with substantial overseas earnings, we think increasing the UK weighting is appropriate. Whilst disposing of the SVM fund for choice, we now include the Axa Framlington UK Select Opportunities fund which is a very consistent performer and the Invesco Perpetual Income fund to benefit from a high dividend stream.

The US economy appears to be moving ahead at a greater rate than forecast by many and so we have added to exposure here using the Henderson US Growth. European markets appear to offer great value but the well-known issues will hold things back and so we are now neutrally weighted and have included the Jupiter European Special Situations fund for diversification (reducing the Blackrock fund accordingly).

The UK and US increases have been funded by a reduction in the Far Eastern, Global Income and Emerging Market sectors with existing holdings trimmed back or, in the case of the Invesco Perpetual Global Equity Income and Fidelity South East Asia funds, disposed of altogether. The M&G Asian fund has been added for choice on the grounds of consistent outperformance.

25th August 2011
As a semblance of normality returns to the market – although no-one believes we are totally out of the woods yet – it is felt appropriate to return to equities whilst adding to the Far East and Emerging Markets as well as Gold mining shares at the expense of US and European equities.

Whilst Gold has set new highs recently and there are concerns the price may fall, many mining shares have not kept up with the price of the metal and this gives us confidence value remains. It is also true that comparative valuations in the parts of the World growing nicely have improved and hence we have increased weighting here.

This has meant adding to existing holdings but we have included the Standard Life UK Unconstrained Equity holding for the first time after a conversation with the management group and their confidence in the fund at these levels.

In the lower risk portfolios, we have added to our Index linked bond holdings as the outlook for inflation suggests this may stay higher for longer than previously thought.

9th August 2011
As major volatility continues we have taken the view it is worth taking some more risk off the table and have disposed of the Aegon High Yield bond, the Jupiter European and Schroder US Smaller Companies fund. In the Cautious and Very Cautious fund we have sold the InvPerp holding as well as the Aegon fund. The proceeds have been placed into a Cash fund.

This is a reaction to the great uncertainty that exists right now but will, hopefully, be a short term measure as it is felt excellent value exists in the equity market and the longer term outlook is positive.

5th August 2011
The recent turmoil surrounding sovereign debt has dragged down the value of profitable companies making markets look very cheap in certain areas. We feel this has to be unlocked over the medium term but the short term is extremely uncertain. We have sold the JO Hambro fund, therefore, and will place the proceeds in cash for the time being.

18th July 2011
Whilst the outlook for equities remains cloudy in the short term at least, continued growth in the Far East encourages us that Property in this region can continue to outperform. We have increased exposure using the Aviva Asian Property fund in the Balanced, Cautious and Very Cautious portfolios reducing cash and Index Linked bonds appropriately.

We have reduced exposure to equities in the Cautious portfolio and consolidated all holdings into the impressive M&G Global Dividend and InvPerp Global Equity Income funds to give us weighting to dividend paying, value stocks across the globe; our preferred sector right now.

2nd June 2011
The Blackrock UK Income fund has slipped a little of late although we remain positive about the sector medium term. It has been replaced, therefore, with the JOHambro UK Equity Income fund which swims in much the same water but maintains a smaller/mid-cap bias that will diversify the rest of the portfolio.

Inflation is becoming a concern in developing economies and so we have disposed of the Emerging Market Debt fund and replaced it with the M&G Index Linked bond fund that, it is thought, should continue to do well at least until the New Year when inflation may subside somewhat.

4th May 2011
The announcement that Osama Bin Laden has been killed by US Special Forces may well trigger some retailatory action. Whilst it is hoped this will not happen, some of the cash currently held is now being invested into a Gold based fund as the metal is likely to provide a safe haven and increase in value by reason of demand if this happens. If not, there is an argument Gold will continue to strengthen in value anyway as long as real interest rates remain negative. The Blackrock Gold and General fund is being used as a good proxy for the metal and with an excellent record.

5th April 2011
Financial markets have settled substantially since the Japanese earthquake to the point that it is felt we should return to some degree. We have reinstated half the direct Japan exposure through the GLG fund and added to our UK exposure, withdrawn as a precaution, via the Investec Special Situation fund which focuses on large capitalised stocks in this country.

15th March 2011
It is becoming apparent that the Japanese earthquake and subsequent tsunami will have a greater impact on local and world economies than initially thought. For this reason, our Japanese exposure has been sold and some additional money (Old Mutual Mid 250 fund) taken out of equities and placed into cash for the time being. This will be monitored as, historically, events like this have proved very short lived as far as their impact on markets is concerned.

1st March 2011
We are still underweight fixed interest securities but believe higher yielding bonds can outperform as the world economy improves assisting the credit ratings of many trading entities. A rating improvement reduces perceived risk and should push prices higher. This could offset any weakness due to rate increases in the government and investment grade sectors. For this reason, we have moved away from the M&G Optimal Income fund to the Aegon High Yield fund which can evidence very good past performance in this area

18th January 2011
With UBS suggesting the prospective P/E ratio on the UK market is now less than 11x an increase in UK exposure is thought appropriate. The defensive Invesco Perpetual holding has been disposed of and replaced with SVM UK Growth and Neptune UK Special Situations for broader market exposure.

The recent defensive move into Fixed Interest securities has been reversed to facilitate this with the Old Mutual fund sold.

European exposure is increased as this market has lagged others in 2010 due to the debt crisis but this should not hold back equities this year and direct Emerging Market exposure is favoured and increased using the Lazard vehicle.

Global equities has been trimmed to provide the increased weightings to Europe and Emerging Markets.

For Neptune UK Special Sits please read Old Mutual UK Mid Cap and for Lazard Emerging change to Aberdeen Emerging.

26th November 2010
The indications suggest that there is very good value in parts of core Europe right now so we are making a switch at the margin away from the US to this area of the world. We are also disposing of the Gartmore US fund replacing it with Schroder US Smaller Companies as there is some turmoil in the Gartmore stable right now and the Schroder fund is an excellent long term performer.

We have also chosen to replace the Baring Global bond fund with the Old Mutual equivalent as the impact of recent recruit, Stewart Cowley, begins to pay dividends.

The Newton Global Dividend fund is being replaced by the Invesco Perpetual Global Equity Income fund believing the latter can improve recent performance.

Most interestingly, whilst we remain sceptical of UK Property, some value in Asian markets is thought to exist due to superior economic performance in this region. A stake in the Aviva Asian Pacific Property fund is being acquired to more closely align ourselves with the benchmark.

28th October 2010
The prospects for growth in the stockmarket in Japan do not look particularly exciting and for this reason we have chosen to reduce our exposure from 8% to 6%.

We are also a little concerned about the impact of the proposed cuts in Government spending in the UK and, whilst the market takes time to assimilate this, we think there may be some weakness and so we have reduced our UK exposure and put all of the cash raised into the Global Bond fund as a short term safe haven.

It is likely the UK position will be restored once matters have settled.

16th September 2010
We are maintaining an underweight position to fixed interest securities but moving some of the existing holdings into the Investec Emerging Markets Debt Fund which we feel offers better value.

Equity portfolios will now include the Invesco Perpetual High Income and Newton UK Opportunities Funds in a straight replacement for the Schroder Income and Fidelity Special Situations Funds which appear to have gone off the boil slightly. These are changes for choice at this time.

In the Far East, we are more equally balancing the two current holdings with the Invesco Perpetual Asia Fund replacing the Aberdeen Fund going forward.

The adventurous portfolio is showing a small reduction in the fixed interest securities proportion enabling us to increase the equity position and the same move is reflected in the balanced portfolio.

The cautious portfolio shows a reduction in the cash holding in favour of fixed interest securities which now absorbs the risk associated with property – still not included – as well as its own sector.

These changes will be reflected immediately.

17th August 2010
As a house, we remain unattracted to Property but feel there is some value in Emerging Market Debt and have added to this fixed interest exposure at the expense of cash, for the time being. Whilst this, notionally, in some portfolios, exceeds the top weighting to fixed interest securities, we feel this is replacing some Property exposure and, therefore, not adding to the maximum risk allowed.

The Investec Emerging Markets Debt fund is a market leader and is being used for this purpose.

15th July 2010
Equity markets have slipped back over the last few weeks suggesting better value is available and we have moved further money out of our fixed interest weighting in favour of the Far East and Emerging Markets. This involves trimming both the M&G Optimal Income and Baring Global bond funds in favour of Aberdeen Asia and supplementing First State Emerging, both funds with an excellent current record and, in the latter case, some defensive qualities.

6th July 2010
Markets, including those in the Far East and Emerging regions, have slipped back during June on worries about the global recovery. Valuations now suggest reasonable value exists over the medium term and so we have taken some funds out of fixed interest securities and added this to our Far East and Emerging market exposure. This involves increasing the weight of existing holdings and adding in the Aberdeen Asia Pacific fund which has been a consistently good performer over the last few years.

4th May 2010
Having recently switched money out of equities and into bonds during the turbulent month of May, the renewed levels suggest that the reverse move is probably appropriate now and we are moving money out of the Baring Global Bond Fund and into the Newton Global Dividend Fund to take advantage of internationally trading companies on a good dividend yield.