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 – May 2021
Economic data has been strong over the last month, but markets have been more muted after an already strong start to the year. The ongoing vaccine rollout is allowing many economies to gradually reopen, which in combination with sizeable fiscal support – particularly in the UK and US is supporting a big bounce in economic activity. Nevertheless, markets were constrained in May by concerns that upside data surprises may result in more persistent inflation, which could force central banks to bring about a premature end to the growth rebound. Developed market equities managed to gain 1.5% for the month. Expectations of stronger economic growth and inflation favoured value over growth. MSCI World Value rose 3.0% and MSCI World Growth fell 0.1%. With inflation on the rise, global inflation-protected bonds gained 3.0% on the back of strong demand.
In the US, the Purchasing Managers’ Indices (PMIs) for manufacturing and services both beat expectations in May, as they rose to their highest levels on record. The details of the PMIs not only showed that consumer demand remains buoyant but also that businesses are facing rising input costs. Headline inflation rose to 4.2% year on year for April. A rise in inflation was expected given the fall in prices this time last year, but even month-on-month inflation rose 0.8%, well above consensus expectations. US corporate earnings for the first quarter were much stronger than expected. S&P 500 companies reported earnings growth of 47% year on year relative to consensus expectations for 20% growth. Despite the strong earnings performance, the S&P 500 rose 0.7% in May, but the more expensive technology and consumer discretionary sectors, which make up 40% of the index, came under pressure.
In Europe, the prospects for a strong growth rebound this year have therefore risen and this has helped European equities. The MSCI Europe ex-UK Index rose 2.8% in May, the best performing major equity index. The eurozone PMIs for May were also positive. While manufacturing has been recovering since last year, the rebound in the services sector had been delayed by ongoing restrictions. Vaccinations appear to now be boosting confidence in the services sector, as evidenced by the improvement in the services PMI business survey to a level above 55.
EM index delivered returns of 2.3% over the month, while Asian equities were up 1.2%. After a strong run between the start of last year and February of this year, Asian equities have given back some of their gains in the last few months before rallying in the latter half of May. Growth stocks have led the decline since February, and the reversal of their fortunes in May helped Asian markets to move higher again. Still, with Chinese growth stocks having corrected by over 20% since February, valuations now look more attractive.
Outlook
We made no changes during the month. Our tactical bias remains unchanged: overweight in EM debt and equities, overweight in small cap, slightly long spread duration and underweight rate duration.
Performance Review – May 2021
The MSCI ACWI (USD) was up +1.5% during the month while the Barclays Global Aggregate index (USD hedged) was up +0.0%.
Active management had a mixed contribution. Over the 28 funds we have in the portfolios, 17 were outperforming their respective benchmark but active management in equities was significantly deteriorating due to the underperformance of small cap equities.
In absolute terms, the Balanced portfolio (+0.8%) outperformed the Yield & Income portfolio (+0.8%) and the Growth portfolio (+0.6%).
Yield & Income Portfolio (USD)
The portfolio outperformed its benchmark by +14bps in May. Active management and our tactical exposure in fixed income more than compensated the underperformance of equity funds. EM debt hard currency (+1.7%) and local debt (+3.0%) were the strongest relative contributors. Overall, active management had a flat contribution of -3bps.
Balanced Portfolio (USD)
The portfolio underperformed its benchmark (-7bps). Funds of Absolute Return did again particularly well (risk premia strategy +1.5%, long/short equity +1.9%, Merger Arbitrage +1.2%). They did not fully compensate for the structural underweight in equities and the negative contribution of active management (-17bps).
Growth Portfolio (USD)
The Growth portfolio underperformed its benchmark by -59bps in May. The overweight exposure in small cap as well as our thematic fund in Healthcare and Consumer lagged this month. Overall, active management contribution was also a deteriorating factor (-41bps).
US Dollar Portfolios
USD - Yield and Income
Cumulative Performance to end May 2021
Calendar Returns
| Jan | Feb | Mar | Apr | May | Jun | Jul | Aug | Sep | Oct | Nov | Dec | YTD | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Portfolio | 2021 | 0.20% | 0.67% | -0.24% | 2.23% | 0.80% | 3.70% | |||||||
| Benchmark | -0.51% | -0.28% | 0.62% | 1.62% | 0.66% | 2.11% | ||||||||
| 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 May 2021
Calendar Returns
| Jan | Feb | Mar | Apr | May | Jun | Jul | Aug | Sep | Oct | Nov | Dec | YTD | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Portfolio | 2021 | 0.61% | 1.39% | -0.24% | 1.99% | 0.81% | 4.64% | |||||||
| Benchmark | -0.49% | 0.37% | 1.14% | 2.31% | 0.88% | 4.25% | ||||||||
| 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 May 2021
Calendar Returns
| Jan | Feb | Mar | Apr | May | Jun | Jul | Aug | Sep | Oct | Nov | Dec | YTD | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Portfolio | 2021 | 0.55% | 1.37% | -0.56% | 2.80% | 0.62% | 4.85% | |||||||
| Benchmark | -0.47% | 1.01% | 1.65% | 3.00% | 1.11% | 6.43% | ||||||||
| 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 May 2021
Calendar Returns
| Jan | Feb | Mar | Apr | May | Jun | Jul | Aug | Sep | Oct | Nov | Dec | YTD | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Portfolio | 2021 | 0.50% | 0.82% | 0.91% | 1.16% | 0.23% | 3.68% | |||||||
| Benchmark | -0.33% | -0.29% | 1.68% | 0.75% | 0.09% | 1.91% | ||||||||
| Portfolio | 2020 | 0.53% | -2.09% | -10.15% | 6.30% | 3.67% | 2.35% | 1.21% | 2.25% | -0.37% | -0.38% | 4.70% | 1.75% | 9.15% |
| Benchmark | 1.13% | -1.73% | -5.70% | 4.62% | 1.04% | 1.00% | 0.61% | 1.02% | -0.20% | -0.66% | 3.46% | 0.87% | 5.22% | |
| 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 May 2021
Calendar Returns
| Jan | Feb | Mar | Apr | May | Jun | Jul | Aug | Sep | Oct | Nov | Dec | YTD | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Portfolio | 2021 | 0.84% | 1.41% | 0.73% | 1.03% | 0.35% | 4.43% | |||||||
| Benchmark | -0.18% | 0.38% | 2.77% | 1.04% | 0.07% | 4.12% | ||||||||
| Portfolio | 2020 | 0.13% | -2.66% | -8.37% | 5.87% | 2.62% | 1.74% | 1.18% | 2.14% | -0.39% | -0.06% | 5.39% | 2.17% | 9.37% |
| Benchmark | 0.88% | -3.11% | -7.66% | 6.19% | 1.46% | 1.29% | 0.45% | 1.98% | -0.50% | -0.95% | 4.95% | 1.22% | 5.63% | |
| Portfolio | 2019 | 3.70% | 1.71% | 0.86% | 1.56% | -2.56% | 1.43% | 1.56% | -1.09% | 1.43% | 0.91% | 1.80% | 1.08% | 12.98% |
| 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% | -0.93% | 1.60% | 0.42% | -0.67% | 1.30% | -0.19% | 0.71% | -2.76% | -0.21% | -2.66% | -3.17% |
| 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% | 1.57% | -0.12% | 0.19% | 4.72% |
| 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 | 0.25% | 2.48% | 1.02% | 0.24% | 0.35% | 1.68% | 1.74% | 8.00% | |||||
| 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 May 2021
Calendar Returns
| Jan | Feb | Mar | Apr | May | Jun | Jul | Aug | Sep | Oct | Nov | Dec | YTD | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Portfolio | 2021 | 1.06% | 1.44% | 1.41% | 1.02% | -0.23% | 4.78% | |||||||
| Benchmark | -0.02% | 1.05% | 3.86% | 1.32% | 0.05% | 6.37% | ||||||||
| Portfolio | 2020 | 0.07% | -3.39% | -8.86% | 7.92% | 2.08% | 2.18% | 0.65% | 2.86% | -0.13% | -0.14% | 6.55% | 2.18% | 11.49% |
| Benchmark | 0.63% | -4.49% | -9.63% | 7.76% | 1.88% | 1.58% | 0.28% | 2.94% | -0.80% | -1.24% | 6.45% | 1.57% | 5.91% | |
| Portfolio | 2019 | 5.86% | 2.49% | 1.58% | 2.40% | -4.08% | 2.86% | 1.94% | -1.50% | 1.46% | 0.72% | 2.68% | 1.14% | 18.65% |
| 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% | -1.70% | 1.97% | 1.78% | -1.28% | 1.39% | 0.87% | 0.07% | -5.27% | 0.55% | -4.81% | -7.06% |
| 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% | 2.43% | -0.28% | 0.98% | 8.82% |
| 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 | -0.95% | 3.88% | 1.55% | 0.66% | 0.46% | 2.35% | 1.69% | 9.98% | |||||
| 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