WSP Model Portfolios are built from our universe of selected active Ucits funds. We manage actively the allocation according to current and expected market conditions and taking into consideration the fund managers’ exposure.
The aim is to demonstrate that an optimal combination of strategies, coupled with a careful selection of active fund managers, have the ability to deliver added-value to investors over the long run, while keeping a full exposure and constant asset allocation within the given investment profiles.
More detailed reporting including portfolio quantitative and qualitative data are available to customers having subscribed to the WS Partners Model Portfolio Services. Would you request more information on this service, please contact us.
Portfolios Structure
- Portfolios are made of 14 to 17 Ucits or Alternative Ucits funds (according to profile).
- Two currency based portfolios ; in US dollar or in Euro.
- Apart one fund with a bi-monthly liquidity, all funds have a daily liquidity.
- Usually we select identical funds either for US dollar or Euro based portfolios, but keeping currency exposure hedge for fixed income funds.
- The performances are shown net of fees, calculated from the cheapest share classes, hence making our Model Portfolios fully replicable.
Strategic Allocations
We keep a constant balance between equity and fixed income strategies according to Model Portfolio profiles and guidelines. We also maintain a neutral currency and regional allocation compare to benchmarks.
The portfolio outperformance should mainly arise from the alpha generated by active management, and to a certain extent to a diversification optimisation. Tactical bets such as investment style (value, growth defensive), sector allocation (e.g., commodities, real estate), interest rate or spread duration may also contribute, time to time, to the value added generation.
A conservative portfolio with a 1/3 equity and 2/3 fixed income allocation.
Within the equity universe we tend to favour yielding strategies rather than pure price appreciation funds.
The objective is to outperform over time a benchmark composed by 1/3 of the MSCI All Country World Index, and by 2/3 of the Barclays Global Aggregate Bond Index.
The portfolio aims to outperform a benchmark made of 50% MSCI All Country World Index, and 50% Barclays Global Aggregate Bond Index in a risk-adjusted return basis and with a capital preservation mindset.
For that reason, we maintain around 33% of the portfolio allocation into Absolute Return strategies, including Alternative Ucits funds.
The most equity oriented portfolio with the aim to beat a benchmark composed by 2/3 of the MSCI All Country World Index and 1/3 of the Barclays Global Aggregate Bond Index. Growth of capital through capital appreciation is the main long term portfolio objective.
Market Review and Outlook
Market Review – January 2021
After a strong start to the month, most equity markets gave up their gains as the month ended. Developed market equities ended the month down 1%, although emerging markets significantly outperformed, ending January up about 3%. Robust economic data and a moderate winter wave of Covid infections continued to support risky assets in north Asia. Strong returns from Greater China contributed to the outperformance of emerging market equities.
Defensive assets, such as high-quality bonds, were on the back foot in the first weeks of the month. But as risk assets sold off, government bonds regained some of their losses, with the ten-year treasury ending January down 1%.
In the US the macro data is painting a mixed picture of the US economy. January’s flash-PMI continued to point to expanding economic activity, with the manufacturing index at 59.1 and services at 57.5. The housing market is another area of strength, with construction starts rising in December at the fastest pace since 2006 and accelerating home prices. For bond markets, increased expectations of government spending are putting upward pressure on long-dated US Treasury yields and for equities, an environment of moderately higher government bond yields and improving near-term growth prospects should provide support for value sectors and small caps on a relative basis.
In Europe, sentiment, and growth in the eurozone took a turn for the worse in January. The flash-composite PMI for the region declined to 47.5 and consumer confidence retreated. The weakness in activity reflects the effect of the ongoing pandemic. New and more infectious virus strains are magnifying the challenge for policymakers, who responded with more stringent lockdown and social distancing measures. Therefore, a double-dip recession has become more likely. Slow vaccine rollout in the large economies of the eurozone is increasing the risk of a delay in the economic recovery.
Outlook
We made no change during the month, neither in the macro positioning of the portfolios explained last month, nor in the portfolio’s composition.
Performance Review – January 2021
The MSCI ACWI (USD) was down -0.5% during the month while the Barclays Global Aggregate index (USD hedged) was down -0.5%.
Active management had a positive contribution. Over the 27 funds we have in the portfolios, 16 were outperforming their respective benchmark. Alpha generation came mainly from the alternative strategies in fixed income and long/short equities.
In absolute terms, the Balanced portfolio (+0.6%) outperformed the Growth portfolio (+0.5%) and the Yield & Income portfolio (+0.2%).
Yield & Income Portfolio (USD)
The portfolio outperformed its benchmark by +71bps in January. Risk premia in credit strategies started to fade, particularly in EM debt which were in negative territory, both for corporates and sovereign. On the other alternative fixed income strategies such as higher quality CLOs (+1.0%) and RMBS (+0.9) were contributors to the performance. The underweight in value-style strategies was a slight headwind. Contribution of active management was slightly positive (+15bps).
Balanced Portfolio (USD)
The portfolio outperformed its benchmark (+0.6% vs -0.5%). Absolute return did well during the month, in particular the merger arbitrage fund (+2.0%) and a long/short equity (+2.0%), the overweight exposure in EM equity was also a contributing factor. Active management was adding to performance (+35bps)
Growth Portfolio (USD)
The Growth portfolio was outperforming its benchmark by +102bps in January. Uncorrelated fixed income strategies such as factoring (+0.4%), cat bonds (+0,4%), added to the RMBS and CLOs strategies mentioned before were the main relative contributors. Active management contributed slightly (+12bps).
US Dollar Portfolios
USD - Yield and Income
Cumulative Performance to end January 2021
Calendar Returns
| Jan | Feb | Mar | Apr | May | Jun | Jul | Aug | Sep | Oct | Nov | Dec | YTD | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Portfolio | 2021 | 0,20% | 0,20% | |||||||||||
| Benchmark | -0,51% | -0,51% | ||||||||||||
| Portfolio | 2020 | 0,19% | -2,47% | -10,45% | 6,50% | 4,71% | 2,76% | 3,30% | 2,59% | -1,03% | -0,48% | 5,95% | 2,77% | 13,96% |
| Benchmark | 0,81% | -1,89% | -5,60% | 4,64% | 1,62% | 1,37% | 2,46% | 1,45% | -0,80% | -0,83% | 4,49% | 1,73% | 9,40% | |
| Portfolio | 2019 | 4,59% | 1,67% | 0,63% | 1,97% | -2,39% | 2,91% | 0,90% | -1,11% | 0,95% | 1,69% | 1,37% | 2,17% | 16,26% |
| Benchmark | 3,39% | 0,96% | 1,58% | 1,16% | -1,02% | 3,11% | 0,61% | 0,71% | 0,37% | 0,79% | 0,72% | 1,01% | 14,14% | |
| Portfolio | 2018 | 2,88% | -1,91% | -0,66% | 0,76% | -0,63% | -0,50% | 1,50% | -0,20% | 0,71% | -3,54% | -0,22% | -2,48% | -4,36% |
| Benchmark | 1,42% | -1,55% | -0,21% | 0,07% | 0,26% | -0,04% | 1,00% | 0,42% | -0,12% | -2,63% | 0,80% | -1,48% | -2,12% | |
| Portfolio | 2017 | 2,15% | 1,58% | 0,72% | 1,01% | 1,27% | 0,19% | 1,55% | 0,03% | 0,58% | 1,05% | 0,61% | 1,07% | 12,45% |
| Benchmark | 0,68% | 1,49% | 0,35% | 0,95% | 1,10% | -0,06% | 1,13% | 0,71% | 0,32% | 0,95% | 0,73% | 0,63% | 9,36% | |
| Portfolio | 2016 | 1,16% | 2,25% | 1,04% | 0,86% | -0,43% | -1,25% | 1,25% | 4,93% | |||||
| Benchmark | 1,04% | 1,81% | 0,06% | 0,17% | -1,23% | -0,86% | 0,84% | 1,81% |
Benchmark: 1/3 iShares MSCI All Country World ETF (EUR) + 2/3 X II Barclays Gbl Agg ETF H EUR
Source: WS Partners, Morningstar
USD - Balanced
Cumulative Performance to end January 2021
Calendar Returns
| Jan | Feb | Mar | Apr | May | Jun | Jul | Aug | Sep | Oct | Nov | Dec | YTD | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Portfolio | 2021 | 0,61% | 0,61% | |||||||||||
| Benchmark | -0,49% | -0,49% | ||||||||||||
| Portfolio | 2020 | -0,68% | -2,98% | -8,44% | 5,95% | 3,34% | 2,14% | 3,08% | 2,52% | -0,96% | -0,17% | 6,33% | 3,04% | 12,93% |
| Benchmark | 0,33% | -3,43% | -7,62% | 6,15% | 2,29% | 1,82% | 3,15% | 2,60% | -1,43% | -1,24% | 6,47% | 2,45% | 11,20% | |
| Portfolio | 2019 | 4,01% | 1,50% | 0,36% | 1,64% | -2,65% | 2,65% | 0,92% | -1,37% | 1,24% | 1,94% | 1,43% | 1,99% | 14,36% |
| Benchmark | 4,50% | 1,38% | 1,48% | 1,71% | -2,24% | 3,97% | 0,54% | -0,06% | 0,80% | 1,28% | 1,15% | 1,63% | 17,18% | |
| Portfolio | 2018 | 2,75% | -1,59% | -0,42% | 0,82% | -0,97% | -0,54% | 1,49% | -0,32% | 0,78% | -3,58% | -0,07% | -2,11% | -3,84% |
| Benchmark | 2,47% | -2,21% | -0,73% | 0,31% | 0,22% | -0,15% | 1,50% | 0,48% | 0,02% | -3,84% | 0,96% | -2,88% | -3,96% | |
| Portfolio | 2017 | 1,85% | 1,21% | 0,74% | 0,84% | 0,87% | 0,64% | 1,73% | 0,04% | 1,19% | 1,03% | 0,93% | 0,66% | 12,35% |
| Benchmark | 1,19% | 1,82% | 0,56% | 1,10% | 1,37% | 0,07% | 1,54% | 0,63% | 0,72% | 1,23% | 1,02% | 0,88% | 12,82% | |
| Portfolio | 2016 | 0,01% | 2,83% | 0,94% | 0,65% | -0,55% | 0,36% | 1,59% | 5,93% | |||||
| Benchmark | 0,62% | 2,43% | 0,12% | 0,28% | -1,35% | -0,46% | 1,17% | 2,81% |
Benchmark: 1/2 iShares MSCI All Country World ETF (EUR) + 1/2 X II Barclays Gbl Agg ETF H EUR
Source: WS Partners, Morningstar
USD - Growth
Cumulative Performance to end January 2021
Calendar Returns
| Jan | Feb | Mar | Apr | May | Jun | Jul | Aug | Sep | Oct | Nov | Dec | YTD | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Portfolio | 2021 | 0,55% | 0,55% | |||||||||||
| Benchmark | -0,47% | -0,47% | ||||||||||||
| Portfolio | 2020 | -0,68% | -4,30% | -9,68% | 8,05% | 3,42% | 2,83% | 4,24% | 3,53% | -1,30% | -0,43% | 8,50% | 3,72% | 17,74% |
| Benchmark | -0,16% | -4,98% | -9,63% | 7,67% | 2,96% | 2,26% | 3,84% | 3,75% | -2,06% | -1,65% | 8,44% | 3,17% | 12,84% | |
| Portfolio | 2019 | 6,20% | 2,06% | 0,71% | 2,39% | -4,35% | 4,44% | 0,61% | -2,00% | 0,95% | 2,30% | 2,02% | 2,51% | 18,89% |
| Benchmark | 5,61% | 1,81% | 1,38% | 2,27% | -3,47% | 4,83% | 0,46% | -0,83% | 1,23% | 1,77% | 1,57% | 2,25% | 20,23% | |
| Portfolio | 2018 | 3,65% | -2,87% | -1,07% | 0,82% | -0,44% | -1,19% | 1,66% | 0,54% | 0,00% | -6,66% | 0,64% | -4,12% | -9,06% |
| Benchmark | 3,53% | -2,87% | -1,24% | 0,54% | 0,17% | -0,26% | 2,00% | 0,55% | 0,16% | -5,05% | 1,13% | -4,28% | -5,81% | |
| Portfolio | 2017 | 2,83% | 1,52% | 1,28% | 1,65% | 1,88% | 0,46% | 2,48% | -0,28% | 1,77% | 1,50% | 1,22% | 1,64% | 19,45% |
| Benchmark | 1,70% | 2,14% | 0,78% | 1,25% | 1,65% | 0,19% | 1,95% | 0,54% | 1,12% | 1,51% | 1,32% | 1,12% | 16,37% | |
| Portfolio | 2016 | -1,01% | 4,18% | 1,46% | 1,17% | -1,04% | 0,28% | 1,33% | 6,44% | |||||
| Benchmark | 0,21% | 3,05% | 0,19% | 0,39% | -1,47% | -0,06% | 1,50% | 3,80% |
Benchmark: 2/3 iShares MSCI All Country World ETF (EUR) + 1/3 X II Barclays Gbl Agg ETF H EUR
Source: WS Partners, Morningstar
Euro Portfolios
Euro - Yield and Income
Cumulative Performance to end January 2021
Calendar Returns
| Jan | Feb | Mar | Apr | May | Jun | Jul | Aug | Sep | Oct | Nov | Dec | YTD | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Portfolio | 2021 | 0,50% | 0,50% | |||||||||||
| Benchmark | -0,33% | -0,33% | ||||||||||||
| Portfolio | 2020 | 0,53% | -2,09% | -10,15% | 6,30% | 3,67% | 2,35% | 1,21% | 2,26% | -0,36% | -0,38% | 4,70% | 1,75% | 9,18% |
| Benchmark | 1,13% | -1,73% | -5,70% | 4,62% | 1,04% | 1,00% | 0,61% | 1,11% | -0,20% | -0,66% | 3,46% | 0,87% | 5,32% | |
| Portfolio | 2019 | 4,15% | 1,82% | 1,00% | 1,86% | -2,37% | 1,85% | 1,52% | -0,82% | 1,13% | 0,67% | 1,75% | 1,25% | 14,54% |
| Benchmark | 3,06% | 1,06% | 1,89% | 1,05% | -1,02% | 2,15% | 1,22% | 0,92% | 0,56% | -0,15% | 1,00% | 0,23% | 12,58% | |
| Portfolio | 2018 | 1,46% | -1,36% | -1,10% | 1,26% | 0,42% | -0,66% | 1,26% | -0,03% | 0,64% | -2,96% | -0,39% | -2,99% | -4,49% |
| Benchmark | 0,04% | -0,99% | -0,65% | 0,53% | 1,28% | -0,21% | 0,78% | 0,45% | -0,21% | -2,02% | 0,66% | -1,98% | -2,37% | |
| Portfolio | 2017 | 1,24% | 2,08% | 0,35% | 0,20% | 0,10% | -0,38% | 0,23% | -0,41% | 0,61% | 1,46% | -0,20% | 0,56% | 5,97% |
| Benchmark | -0,24% | 2,01% | 0,03% | 0,26% | -0,09% | -0,64% | -0,11% | 0,31% | 0,41% | 1,35% | -0,17% | 0,26% | 3,39% | |
| Portfolio | 2016 | 1,12% | 2,05% | 1,00% | 0,53% | 0,20% | -0,23% | 1,34% | 6,16% | |||||
| Benchmark | 1,03% | 1,51% | 0,11% | -0,22% | -0,52% | 0,14% | 0,92% | 3,00% |
Benchmark: 1/3 iShares MSCI All Country World ETF (EUR) + 2/3 X II Barclays Gbl Agg ETF H EUR
Source: WS Partners, Morningstar
Euro - Balanced
Cumulative Performance to end January 2021
Calendar Returns
| Jan | Feb | Mar | Apr | May | Jun | Jul | Aug | Sep | Oct | Nov | Dec | YTD | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Portfolio | 2021 | 0,84% | 0,84% | |||||||||||
| Benchmark | -0,18% | -0,18% | ||||||||||||
| Portfolio | 2020 | 0,13% | -2,42% | -8,89% | 5,87% | 2,62% | 1,74% | 1,18% | 2,18% | -0,36% | -0,06% | 5,39% | 2,17% | 9,10% |
| Benchmark | 0,88% | -3,11% | -7,66% | 6,19% | 1,46% | 1,29% | 0,45% | 2,12% | -0,50% | -0,95% | 4,95% | 1,22% | 5,78% | |
| Portfolio | 2019 | 3,70% | 1,71% | 0,84% | 1,56% | -2,56% | 1,43% | 1,41% | -1,09% | 1,43% | 0,91% | 1,80% | 1,08% | 12,81% |
| Benchmark | 4,15% | 1,66% | 2,07% | 1,69% | -2,11% | 2,68% | 1,56% | 0,37% | 1,20% | -0,01% | 1,66% | 0,59% | 16,49% | |
| Portfolio | 2018 | 1,08% | -0,82% | -0,91% | 1,60% | 0,42% | -0,67% | 1,30% | -0,19% | 0,71% | -2,76% | -0,21% | -2,66% | -3,16% |
| Benchmark | 0,48% | -1,28% | -1,26% | 1,10% | 1,86% | -0,28% | 1,28% | 0,65% | -0,01% | -2,80% | 0,88% | -3,48% | -2,97% | |
| Portfolio | 2017 | 0,67% | 1,98% | 0,39% | -0,11% | -0,71% | -0,09% | 0,02% | -0,47% | 1,34% | 0,99% | -0,12% | 0,19% | 4,12% |
| Benchmark | -0,12% | 2,65% | 0,16% | 0,13% | -0,33% | -0,72% | -0,22% | 0,12% | 0,93% | 1,91% | -0,23% | 0,41% | 4,72% | |
| Portfolio | 2016 | 0,27% | 2,48% | 1,02% | 0,24% | 0,35% | 1,68% | 1,74% | 8,02% | |||||
| Benchmark | 0,67% | 2,03% | 0,27% | -0,24% | -0,20% | 1,13% | 1,38% | 5,13% |
Benchmark: 1/2 iShares MSCI All Country World ETF (EUR) + 1/2 X II Barclays Gbl Agg ETF H EUR
Source: WS Partners, Morningstar
Euro - Growth
Cumulative Performance to end January 2021
Calendar Returns
| Jan | Feb | Mar | Apr | May | Jun | Jul | Aug | Sep | Oct | Nov | Dec | YTD | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Portfolio | 2021 | 1,06% | 1,06% | |||||||||||
| Benchmark | -0,02% | -0,02% | ||||||||||||
| Portfolio | 2020 | 0,07% | -3,99% | -9,51% | 7,92% | 2,08% | 2,18% | 0,65% | 2,86% | -0,13% | -0,14% | 6,55% | 2,18% | 10,02% |
| Benchmark | 0,63% | -4,49% | -9,63% | 7,76% | 1,88% | 1,58% | 0,28% | 3,13% | -0,80% | -1,24% | 6,45% | 1,57% | 6,11% | |
| Portfolio | 2019 | 5,86% | 2,49% | 1,58% | 2,40% | -4,08% | 2,86% | 1,87% | -1,50% | 1,46% | 0,72% | 2,68% | 1,14% | 18,57% |
| Benchmark | 5,24% | 2,25% | 2,25% | 2,32% | -3,20% | 3,21% | 1,90% | -0,19% | 1,84% | 0,12% | 2,32% | 0,94% | 20,48% | |
| Portfolio | 2018 | 1,10% | -1,62% | -1,45% | 1,97% | 1,78% | -1,28% | 1,39% | 0,87% | 0,07% | -5,27% | 0,55% | -4,81% | -6,81% |
| Benchmark | 0,93% | -1,56% | -1,86% | 1,67% | 2,43% | -0,35% | 1,78% | 0,85% | 0,20% | -3,58% | 1,10% | -4,97% | -3,61% | |
| Portfolio | 2017 | 1,24% | 2,58% | 0,76% | 0,29% | -0,22% | -0,54% | 0,21% | -0,93% | 2,03% | 1,56% | -0,28% | 0,98% | 7,90% |
| Benchmark | 0,00% | 3,28% | 0,29% | 0,00% | -0,56% | -0,81% | -0,34% | -0,08% | 1,45% | 2,46% | -0,29% | 0,57% | 6,05% | |
| Portfolio | 2016 | 0,00% | 3,88% | 1,55% | 0,66% | 0,46% | 2,35% | 1,69% | 11,03% | |||||
| Benchmark | 0,31% | 2,56% | 0,42% | -0,26% | 0,12% | 2,13% | 1,83% | 7,28% |
Benchmark: 2/3 iShares MSCI All Country World ETF (EUR) + 1/3 X II Barclays Gbl Agg ETF H EUR
Source: WS Partners, Morningstar