2017

DFM Managed Portfolio The Master Portfolio Service for Private Clients Quarterly Fact Sheet (end June 2017)

High Growth Portfolio This portfolio is not constrained by asset allocation and will markets and may include direct exposure to higher risk areas typically be for the more adventurous clients who can accept such as emerging market and smaller company funds. No elevated risk/volatility in the search for capital growth. Their attention is paid to income production and this approach is portfolio is likely to be dominated by exposure to the equity likely to be at the more volatile end of the range.

Market Commentary 30th June 2017 Performance Figures up to 30/06/2017 For the third time in as many years, returning more cash to shareholders Britain’s electorate has confounded thanks to improved corporate 38% the expectations of opinion pollsters, governance. 36% although little damage was inflicted 34% 37.0 Emerging Markets, have performed upon financial assets. With around 32% well this year, bouncing strongly as 33.7 three-quarters of revenues generated 30% fears of unfriendly US policies faded. overseas, the companies of the FTSE 28% 30.5 29.8

China’s latest growth spurt has been of 29.5 100 remain beholden to influences well 26%

benefit, as has the weakness of the US 27.7 beyond these shores. The pound’s dollar and Fears of another Asian Crisis 24% recovery this year has represented remain unmet. 22% something of a headwind. Smaller, 20% more domestically oriented companies With so little income available from 18% 20.1 have fared better. Developed Market government bonds, 16% 19.2 we continue to find this asset class 17.9 US equities remain close to all-time 14% 16.6 unappealing. However, its “safety 12%

highs, with the bulk of this year’s gains 13.9 first” nature means that we continue 13.5 coming from growth/tech stocks such 10% to recommend some exposure as as Amazon and Google. However, a 8% insurance. Better yields are available 2000-style technology crash is less 6% from corporate and Emerging Market probable, as these are all dominant, 4%

sovereign bonds. 4.9 2.0 1.7 revenue generating leaders in their 2% 1.9 0.7 3.0 respective industries. Markets appear to be balanced 0% between two conflicting forces. 2015 2016 Last Last Last Inception European equities are finally showing Positively, the global economy is in Quarter Year 3 Years 28/03/14 signs of health, and investors have a synchronised growth phase that Discrete Cumulative been increasingly attracted to the High Growth WMA IA Flexible we have not witnessed since 2010. value and recovery potential on offer. Portfolio Growth Investment More negatively, central banks are Source: IW&I and Financial Express June 2017 However, challenges lie ahead in the considering the withdrawal of the form of possible central bank policy extreme monetary stimulus that has The MPS performance figures are calculated from the average return tightening and an Italian election that is been in place for most of the post- of all portfolios from private clients only, on a total return basis, net of due by May 2018. financial crisis era. The overall outlook all IW&I’s charges. Japan’s economy stubbornly refuses suggests that company earnings can Please remember that past performance is not a reliable to find second gear, but at least hasn’t continue to grow, and, if combined with guide to the future and that previous periods of favourable slipped back into neutral, thanks to dividends, can hold out the promise of performance will not necessarily be repeated in the future. apparently endless monetary stimulus continuing positive returns for equity from the Bank of Japan. The better investors, even if not on the scale of In terms of asset allocation, 1% was added to news is that Japanese companies are past returns. European equities at the expense of Alternative Assets.

Asset Allocation Portfolio Holdings

Fixed Interest 5.0% Artemis US Select Fund Jupiter UK Special Sits Fund Equities 85.5% Aspect Diversified Trends Fund Lazard Emerging Markets Fund U.K. 38.5% Axa Framlington UK Sel. Opps. Fund L&G High Income Trust Europe 12.0% BNY Mellon Newton Global Dynamic Bond Fund MAN GLG Japan Core Alpha Fund U.S. 19.0% Findlay Park American Fund Old Mutual UK Alpha Plus Fund Japan 5.0% Franklin Templeton UK Smaller Companies Fund Picton Property Income Far East 7.0% Emerging 4.0% Gold Bullion Secs 0% NTS Schroder Asia Pacific IT Property 3.0% Henderson European Sel. Opps. Fund Scottish Oriental Smaller Companies Hedge/Alternatives 6.5% JP Morgan UK Equity Core Fund Estimated Net Yield 1.6% Cash 0.0% Jupiter European Fund Estimated OCF 0.8% Source: Investec Wealth & Investment June 2017 Artemis US Select Fund Franklin Templeton UK Smaller L&G High Income Trust The fund aims to achieve long-term capital Companies Fund A defensive high yield fund that is focussed on growth by investing principally in the shares Aims to achieve capital growth over 3-5 the European market. of companies listed in the United States of years exceeding that of the Numis Smaller America. Companies Index. MAN GLG Japan Core Alpha Fund The objective of the fund is to achieve Aspect Diversified Trends Fund Gold Bullion Secs 0% NTS capital growth through investing in Japanese A trend following fund with a low correlation to Aims to replicate the performance of gold. companies. equity markets. Henderson European Sel. Opps. Fund Old Mutual UK Alpha Plus Fund Axa Framlington UK Sel. Opps. Fund This is a core, ‘blue-chip’ fund run by the This fund aims to provide capital growth Nigel Thomas is one of the most experienced highly experienced John Bennett who has through investing in a focused portfolio of Fund Managers in the industry. He has developed a tremendous career track record. between 20 and 30 UK companies with an achieved noteworthy success with his multi- objective of achieving an absolute (not relative) cap approach and we are pleased to support JP Morgan UK Equity Core Fund return. It is typically 75% FTSE 25% mid cap. him. Aims to provide capital growth and out perform the FTSE All share index over long Picton Property Income BNY Mellon Newton Global Dynamic term. Aims to provide an attractive level of income, Bond Fund together with Capital growth by investing in Managed by Paul Brain who aims to achieve Jupiter European Fund Commercial Property Sectors. a total return by investing in government and This is a high conviction European equity fund corporate debt worldwide. and is typically overweight mid and small cap. Schroder Asia Pacific Investment Trust Schroder’s expertise in the Far East has Findlay Park American Fund Jupiter UK Special Sits Fund produced consistently excellent returns for This fund aims to deliver capital growth This fund is a plain vanilla UK Equity Unit Trust over a decade and this fund gives access to through a portfolio of mid and small cap looking for capital growth with a recovery/ their collective management skills. orientated US companies. The manager has a contrarian style. ‘value/quality’ bias to his portfolio. Scottish Oriental Smaller Companies Lazard Emerging Markets Fund Aims to achieve long-term capital growth This specialist trust aims to give exposure to by investing mainly in smaller Asian quoted the fast growing, developing countries of the companies. world. It has a fine track record.

Discrete Calendar Year Performance. Percentage change (total return) in sterling terms. Volatility Drawdown

2015 2016 Inception (28/03/14) 3 Year 3 Year

High Growth Portfolio 4.9 13.5 30.5 7.9 9.3 WMA Growth 3.0 19.2 37.0

Source: IWI and Financial Express June 2017

Important Information Please note, from 1st March 2017 the Wealth Management Association (WMA) changed indices provider from FTSE to MCSI. In order to benchmark the service appropriately we have made the decision to continue using the WMA Private Investor Indices incorporating MSCI. The MPS performance figures are calculated from the average return of all portfolios from private clients only, on a total return basis, net of all IW&I’s charges. The benchmark figures are supplied by Exshare and are on a total return basis. The IA performance numbers are the Investment Association sector averages as provided by FE Analytics. You should remember that the value of investments and the income from them can fall as well as rise. Before proceeding to invest on the basis of this factsheet, you should obtain specific advice on the suitability of the investment in the light of your personal circumstances. Please remember that past performance is not a reliable guide to the future and that previous periods of favourable performance will not necessarily be repeated in the future. We would also refer you, particularly, to the Risk Statement set out in the main Master Portfolio Service brochure. The composition of the portfolio may not be a true reflection of the benchmarks, which are provided for comparison purposes only.

Member firm of the London Stock Exchange. Authorised and regulated by the Financial Conduct Authority. Investec Wealth & Investment Limited is registered in England. Registered No. 2122340. Registered Office: 2 Gresham Street, London EC2V 7QP.

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