Page 1 - Private Wealth Professional SMA (Balanced) PDF Factsheet

SMA Portfolio Change

Professional SMA (Balanced)

As at 26 November 2024

Following a review of your portfolio, we have recently made the following changes:

Rebalance

We continue to have conviction in the target weights of our portfolio (i.e. growth/defensive position
and allocation to each investment class).
Market movements have however resulted in a shift in the actual weights of some of the investment
options moving significantly from the target weight.

In light of this, we have rebalanced some of the holdings in your portfolio, taking profits from some of
your holdings that have performed well and re-allocating the funds to holdings that have lagged and
are below our target weight.

Investment Changes

We have also made the following changes to the investment options in your portfolio:
Sell Ardea Real Outcome

Following a period of ongoing review, we haven’t been able to retain the requisite conviction in Ardea
Real Outcome to retain it in the portfolios. Whilst returns have been below expectations, the lower
conviction is a result of both people and process. The manager has seen quite a few senior departures
over the last few years. We raised some process concerns a little while ago which the manager
acknowledged and was working towards rectifying. But the regular updates we’ve received since
haven’t shown much in the way of progress and the manager hasn’t done a good enough job
explaining the process they’ve gone through.

Buy AB Global Dynamic Global Fixed Income

A relatively unconstrained bond fund which aims to generate a cash plus 3-4% return each year whilst
limiting volatility to traditional bond levels. It focuses its attention on corporate credit, with
government bonds and currency management largely being used as a defensive measure. The team is
well experienced, and the investment approach makes extensive use of the firm’s wider fixed income
resources. The team actively manages the portfolio around 3 broad sleeves: core (high-grade
corporate bonds), return-seeking (emerging markets and high yield), and defensive (government
bonds and currency hedging). The fund has sufficient flexibility to invest across the fixed income
spectrum include investment grade credit, asset-backed securities, high yield, bank loans, and
emerging market debt. This gives the investment team the ability to meet its return targets in both
rising and falling yield environments. This flexibility also allows the investment to protect and possibly
benefit from significant market moving events.