asset allocator header image

Asset Allocator

from Asset Allocator

Evelyn Partners trims equity exposure across portfolios

Asset Allocator's carrier pigeon had an easier end to Q1 than most as it made the short journey to Evelyn Partners to bring forth the latest update from James Burns and his model portfolio team. 

Burns runs the Evelyn Active model portfolio range in line with the Dynamic Planner's guidance, and this largely reflects the decision to trim equity exposure across the models and buy bonds.

Where equity has been cut it has occurred mostly in the US allocation, with Artemis US Extended Alpha sold completely, with Burns saying the relatively high fees aren't justified by recent performance.

That fund is not now owned by any of the allocators we cover. 

They added to their holding in JP Morgan US Equity Income instead, and JP Morgan Japan, which is owned by five of the allocators we cover, albeit it has two sellers in 2022.

There was also a small reduction in the overall UK exposure, and what UK exposure there is involved reducing exposure to large cap focused funds Troy Income and Growth and Ninety One UK Alpha (this fund had a recent change of manager).

The proceeds of this were ploughed into an increased exposure to Gervais Williams's Premier Miton UK Multi-Cap Income fund, which is owned by a total of three of the allocators we cover. 

But the new equity position which will raise eyebrows the highest is the allocation to the Monks investment trust, a global equity mandate run by Baillie Gifford. 

Monks is designed as a lower octane version of some other Baillie Gifford growth strategies, and Burns believes it “complements” his wider equity book. 

Monks is owned by just two allocators on our database - though it is now more popular than Scottish Mortgage which has been sold by four DFMs in recent years and is now only held by one.

In the higher risk profiles, there were also increased investments in Hermes Global Emerging Markets fund and Fidelity Asia, while Schroder Asia Total Return and Fidelity Emerging Markets funds were reduced and exited respectively. 

Fidelity Emerging Markets fund is among the most widely-owned products of its type in our database, being owned by five of the allocators we cover. 

Burns moved the equity proceeds into the Vanguard US Government Bond Index,and the Axa Short Duration US High Yield fund, while exiting the iShares UK 0-5 Year Gilt fund. 

That increased focus on bonds also means a reduced allocation to some of the alternative strategies, particularly NB Uncorrelated Strategies, which has been reduced in many of the portfolios. 

They also sold out of the Sequoia Economic Infrastructure fund, with rising bond yields reducing the case for infrastructure. 

Get the story behind the stories
The daily newsletter for fund buyers