11/02/2021

For what was a torrid year on so many fronts, all APC Classic Core Portfolios recovered over the course of the last quarter in 2020.  All portfolios showed a positive return against their ‘benchmark’ (or the market) over the minimum recommended investment time frame with the lone exception being the APC Classic 100 portfolio.

Global investment markets found optimism finishing 2020 very strongly (up nearly 6% for the quarter) on the back of news regarding vaccine breakthroughs and (eventual) certainty around US Presidential Election results.  The Australian share market was actually one of the strongest performing lifting by ~14% in the quarter thanks to strong results in ‘Small Cap’ and ‘Value’ companies – both of which are targeted premiums in APC’s Classic Core Portfolios.

The Australian economy expanded with Gross Domestic Product (GDP) rising 3.3% and the Aussie dollar rallied against the US finishing just south of US$0.77. However, this was more about a weakening ‘greenback’ which fell ~7% across a broad range of currencies.

Property investments also showed strong signs of recovery (up over 13% for the quarter) after what has been a very challenging period (still down ~4% for the 2020 calendar year) with some pivoting their focus towards regional areas as opposed to CBDs.

With global interest rates remaining low (and probably staying such for some time to come yet) the cash and fixed interest investment environment continues to be challenging however there was a noticeable ‘term premium’ evident and ‘credit spreads’ returned to pre-Covid type levels.

2020 has once again reminded us to ‘stay the course’ and not ‘panic selling’ during times of significant market volatility as the ‘upside’ that so often follows the ‘downs’ assists in a swifter recovery from shocks.