Page 4 - Private Wealth PROFESSIONAL BALANCED

significant falls in house prices, with most Chinese household wealth tied up in property, maintaining downward pressure on both confidence and
sentiment. Manufacturing data also remained weak given lacklustre demand from local and global customers (e.g. Germany) and the imposition of
tariffs by both the US and Europe as the trade war continued. Finally, foreign investor outflows haven’t helped but we did see that change somewhat in
the period (off a very low base) following the announcement of stimulus measures.

Plenty of action on the political and geopolitical front, with the US election nearing, a stalemate in French elections (which markets applauded),
escalations on the conflict in the Middle East and Western trade tensions with China (chips and electric vehicles). President Joe Biden succumbed to
pressure from within, pulling out of the Presidential race with the Democrat Party anointing sitting VP Kamala Harris as their primary candidate.
Former President Trump withstood two assassination attempts on his life, whilst both Harris and Trump announced their VP choices and hit the
campaign trail. Tensions in the Middle East rose as the Irael / Hamas war extended to Yemen, then Iran, and more recently Lebanon. Markets stood up
and took notice, whilst oil prices oddly remained weak in the period.

Portfolio Update
The Portfolio return for the September quarter was exceptionally strong, with investors buoyed by central bank rate cuts and continued resiliency in
economic data as soft-landing expectations reasserted themselves.

All asset classes benefited from rising investor sentiment, supported by easing inflation and declining bond yields. Australian equities rose strongly,
particularly against unhedged global equities, with a rising Australian dollar (more so a falling US dollar) hindering a stronger showing from global
equities. Emerging markets outperformed developed markets, with Chinese equities rocketing higher on Chinese stimulus hopes. The biggest market
moves in the period came from listed property and infrastructure, which surged on a sharp fall in bond yields (particularly real yields) and continued
resiliency in economic data.

On an absolute basis, the best and worst performing investments were as follows:

Top 3:

Lynas Rare Earths

Breville Group

Newmont Corporation

Bottom 3:

Ampol Limited

GQG Partners Global Equity

Mineral Resources Limited

Portfolio changes during the quarter:
Asset allocation settings and underlying investments selected were actively reviewed in the period with no changes made to the portfolio. We think the
portfolio is well balanced for both the risks and opportunities ahead, and particularly well positioned to take advantage of uncrowded parts of the
market as investors draw their attention back to both market and company fundamentals.

Market Outlook
The outlook remains a juxtaposition between deteriorating economic fundamentals, stubborn inflationary thematics, and government and central
bank officials hell-bent on trying to ensure they hold onto every job gain over the last few years whilst bringing inflation back to target in a credible
timeframe and alleviating cost-of-living pressures to shore up re-election chances. Equity investors desperately want (need) to believe, bond investors
want to price rising risks but are prevented from doing so due significant bond supply and somewhat unorthodox fiscal and monetary policy, whilst
commodity investors are pricing in significant economic woes in the absence of gargantuan Chinese stimulus.

We’re continuing to err on the side of caution in light of this given the heightened risks of policy missteps, overcrowded trades, and quite full valuations
which in some cases imbue fairly lofty expectations. But we’re also checking this caution against fiscal and monetary policy which, at least in the short
term, has the ability to patch over and/or hide any of the negativity that usually follows a period of significant rate hikes. A balanced and diversified
approach is sensible for now.