LF Canlife Managed 0%-35% Fund Update

uk equities drive performance

BY DAVID MARCHANT, MANAGING DIRECTOR & CHIEF INVESTMENT OFFICER

Equities continued their strong run in May, as the global economy shrugged off Italian political concerns to once again deliver solid growth numbers. However, the situation in Italy did result in some stockmarket volatility, as did US President Donald Trump’s ‘trade war’ rhetoric.

The UK, however, was more positive as the public finances continued to improve, employment remained strong and consumer confidence bounced back from a weather-hit start to the year. As a result, our exposure to UK equity income stocks proved to be very beneficial to performance. The LF Canlife Managed 0%-35% Fund remains at the top of its sector year-to-date.*

 In fixed income, gilts were the best performing part of the sterling market, as the Italy situation in particular led to some risk aversion from investors. In contrast, corporate bonds were flat for the month, with short duration bonds outperforming. Property also delivered a solid return in May, with attractive rental yields supporting a market that we do not estimate will see significant capital growth in 2018.

Looking forward, we believe the global economic backdrop remains solid, which leads us to prefer equities over bonds from an asset allocation perspective. However, we believe some prudence is necessary, hence our slightly more defensive positioning through holdings of shorter duration bonds.

*Source: Morningstar Direct, as at 31/05/18. C Accumulation share class performance, bid-to-bid with net income reinvested in the IA Mixed Investment 0-35% Shares sector.

 

 

 

 

 

 

 

Important Information

Past performance is not a guide to future performance. The value of investments may fall as well as rise and investors may not get back the amount invested. Income from investments may fluctuate.

The information contained in this document is provided for use by investment professionals and is not for onward distribution to, or to be relied upon by, retail investors. No guarantee, warranty or representation (express or implied) is given as to the document’s accuracy or completeness. The views expressed in this document are those of the fund manager at the time of publication and should not be taken as advice, a forecast or a recommendation to buy or sell securities. These views are subject to change at any time without notice. This document is issued for information only by Canada Life Investments. This document does not constitute a direct offer to anyone, or a solicitation by anyone, to subscribe for shares or buy units in fund(s). Subscription for shares and buying units in the fund(s) must only be made on the basis of the latest Prospectus and the Key Investor Information Document (KIID) available at www.canadalifeinvestments.com. The fund may invest in property funds that may be illiquid and subject to wide price spreads, both of which can impact the value of the fund. The value of the property is based on the opinion of a valuer and is therefore subjective.

Canada Life Investments is the brand for investment management activities undertaken by Canada Life Asset Management Limited, Canada Life Limited and Canada Life European Real Estate Limited. Canada Life Asset Management Limited (no. 03846821), Canada Life Limited (no.00973271) and Canada Life European Real Estate Limited (no. 03846823) are all registered in England and the registered office for all three entities is Canada Life Place, Potters Bar, Hertfordshire EN6 5BA. Canada Life Asset Management is authorised and regulated by the Financial Conduct Authority. Canada Life Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.

CLI01225 Expiry 15 September 2018




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