direct factsheet july 12

7/31/2019 Direct Factsheet July 12

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GROUNDHOGS AND HEDGEHOGS

For those who remember the film Groundhog Day, so was the Euro zone in July, long on rhetoric and short on action, moreof the same. ECB President Draghi said that he would do whatever it takes to save the Euro. Investors needed no excuse tomark European equities materially higher, mindful of the action by the ECB late last year to boost liquidity through LTRO. Wewould caution against assuming a quick fix (Euro zone politicians seem to be prevaricateurs extraordinaire), or that the fix iscertain. European markets are being driven by politics and not fundamentals and whilst that continues we are likely toremain absent. If you remember Draghis predecessor J-C Trichet said " Speculating on Greece defaulting is a certain way olosing out. Such a speculation would be a sure-fire way of losing money given the decisions taken last Thursday " (27 July 2011). Those who were short Greek 10 year bonds made a 70%+ return. Moreover, remember that conditionality was disavowed atthe last EZ summit, only to see the Finns ask for, and receive, collateral as part of the Spanish bank bailout.

Coincident events can be dangerous and there seem to be three which we feel are not priced into equities: First is theslowdown in China, where the co nsensus is a 2 nd quarter trough for GDP. We are more circumspect both in the degree of theslowdown and the timing of recovery and. Should we be proven correct, a lower market may ensue toward the end of the 3 rd

quarter. Next, US earnings expectations are too high for 3 rd & 4th quarter and will have to be revised downwards before thenext earnings season (September). Concluding with our bte noire, the Euro zone, where the German constitutional court isnot due to deliver approval on the ESM until 12 September. I would keep one eye open over the latter part of summer andSeptember in particular.

As if to reiterate the groundhog day nature of this market, our chart this month (courtesy of Soc Gens Albert Edwards)focuses on the S&P 500 index, comparing 2011 & 2012.

MANAGERS MONTHLY COMMENTARY JULY 2012

INVESTMENT MANAGERS

Patrick ToesInvestment Director with over 20 yearsexperience in fund management. Previouslya member of Rensburg Sheppards AssetAllocation and Fund Selection Committees

for over 9 years and former chairman of thosecommittees at BWD Rensburg, he holds a MSC inInvestment Analysis and is an Associate Member of theSociety of Investment Professionals (ASIP).

David Cowell Chief Executive, possessing over 40 yearsexperience in financial services, with over 25years being investment managementfocussed. David formulates the macro

economic position and leads the investment processacross the portfolio range. He also has over 10 yearsexperience of business consultancy to small andmedium sized enterprises.

Myddleton Croft Investment Managers, 1 Woodside Mews, Clayton Wood Close, Leeds, LS16 6QE T: 0113 274 7700 F: 0113 274 7711 E-mail: [email protected] Website: www.myddletoncroft.co.uk

Myddleton Croft Ltd is authorised and regulated by the Financial Services Authority. Registered in England & Wales number 05782909. VAT number UK 889 241088.Registered office: 11 Clifford Avenue, Ilkley, LS29 0AS.

A segue from groundhog to hedgehog I was in my garden and I came across a hedgehog a couple of weeks ago.Unusual, well yes, as I had not seen one for many years and it put me in mind of a quotation, which may be liberallytranslated.

The fox knows many tricks but the hedgehog knows one big trick. (Archilochus)

The hedgehogs one big trick being how to curl up into a ball, its spines making a virtually impregnable haven. We considerourselves somewhat hedgehog-like, we adopt a defensive approach. This does not mean that we only own safe havenassets such as gilts, but that we look within the risky asset space toward investments which offer capital protection. This hasled us to strongly overweight those companies which have fortress-like balance sheets, non-cyclical earnings and a focus onfree cash flow generation.

Since mid 2009 there has been a tug of war between improving companies results and the poor macro economic outlook;often the cause of rallies and corrections respectively. The economic tailwind that allowed investors to rightly point out thecheapness of shares in absolute terms compared to recent history and, in relative terms, to bonds, was due to the strongearnings growth in 2010/11. We consider that this tailwind has lost its puff and as seems likely 2012/2013 earnings will bepedestrian, with significantly more divergence between sectors and companies. Slow and steady growing hedgehog-likeinvestments look likely to be the winners over a more vulpine approach focussed more on geared/cyclical investments.

We have revamped our factsheets to be less wordy and more visual. Thanks to some positive feedback, we have changedthe benchmark we were using to the IMA 20-60% & 40-85% equity sectors. Needless to say we continue to perform strongly.As always we appreciate your feedback and custom.

0113 274 7700Email : [email protected]

Or visit us at :www.myddletoncroft.co.uk

IMPORTANT INFORMATION This i nformation has been approved for distribution toprofessional investors only. The information in thisdocument is believed to be correct but cannot beguaranteed. Past performance is not a guide to futureperformance and may not be repeated. The value of investments and the income from them may go down aswell as up and investors may not get back the amountsoriginally invested. This material is not intended as anoffer or solicitation for the purchase or sale of anysecurity or any other action, without first seeking advice

as to the suitability of it for your needs.


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MCIM Balanced Defensive Portfolio JULY 2012

PERFORMANCE SINCE LAUNCH

2012 PERFORMANCE

INVESTMENT MANAGERS

Patrick ToesInvestment Director with over 20 yearsexperience in fund management. Previouslya member of Rensburg Sheppards AssetAllocation and Fund Selection Committees

for over 9 years and former chairman of thosecommittees at BWD Rensburg, he holds a MSC inInvestment Analysis and is an Associate Member of theSociety of Investment Professionals (ASIP).

David Cowell Chief Executive, possessing over 40 yearsexperience in financial services, with over 25years being investment managementfocussed. David formulates the macro


Model portfolios include cost of underlying investmentsand Myddleton Crofts annual management fees, but notthe charges for custodian, dealing and settlement(equivalent to platform charges)



ASSET ALLOCATION

For further information call :



IMPORTANT INFORMATION This information has been approved for distribution toretail and professional investors only. The information inthis document is believed to be correct but cannot beguaranteed. Past performance is not a guide to futureperformance and may not be repeated. The value of investments and the income from them may go downas well as up and investors may not get back theamounts originally invested. Before contemplating anytransaction, you should consult your financial adviser. This material is not intended as an offer or solicitationfor the purchase or sale of any security or any otheraction, without first seeking advice as to the suitabilityof it for your needs.*Clients portfolios may differ from model portfolios

dependent on their specific objectives.

18%

22%

20%

5%

7%

17%

11% UK Equities

International Equities

Alternatives

Commodities

UK Fixed Interest

Global Fixed Interest

Cash


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MCIM Balanced Cautious Portfolio JULY 2012


2012 PERFORMANCE

INVESTMENT MANAGERS

Patrick ToesInvestment Director with over 20 yearsexperience in fund management.Previously a member of RensburgSheppards Asset Allocation and Fund

Selection Committees for over 9 years and formerchairman of those committees at BWD Rensburg, heholds a MSC in Investment Analysis and is an AssociateMember of the Society of Investment Professionals(ASIP).

David Cowell Chief Executive, possessing over 40 yearsexperience in financial services, with over25 years being investment managementfocussed. David formulates the macro

economic position and leads the investment process

across the portfolio range. He also has over 10 yearsexperience of business consultancy to small andmedium sized enterprises.

Model portfolios include cost of underlyinginvestments and Myddleton Crofts annualmanagement fees, but not the charges for custodian,dealing and settlement (equivalent to platformcharges)



ASSET ALLOCATION




IMPORTANT INFORMATION This information has been approved for distributionto retail and professional investors only. Theinformation in this document is believed to be correctbut cannot be guaranteed. Past performance is not aguide to future performance and may not berepeated. The value of investments and the incomefrom them may go down as well as up and investorsmay not get back the amounts originally invested.Before contemplating any transaction, you shouldconsult your financial adviser. This material is notintended as an offer or solicitation for the purchase orsale of any security or any other action, without firstseeking advice as to the suitability of it for your needs.*Clients portfolios may differ from model portfoliosdependent on their specific objectives.

21%

25%

19%

4%

6%

16%

9% UK Equities


Alternatives

Commodities

UK Fixed Interest


Cash


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MCIM Balanced Moderate Portfolio JULY 2012


2012 PERFORMANCE

INVESTMENT MANAGERS









ASSET ALLOCATION




IMPORTANT INFORMATION This information has been approved for distributionto retail and professional investors only. Theinformation in this document is believed to be correctbut cannot be guaranteed. Past performance is not aguide to future performance and may not berepeated. The value of investments and the incomefrom them may go down as well as up and investorsmay not get back the amounts originally invested.Before contemplating any transaction, you shouldconsult your financial adviser. This material is notintended as an offer or solicitation for the purchase orsale of any security or any other action, without first

seeking advice as to the suitability of it for your needs.*Clients portfolios may differ from model portfoliosdependent on their specific objectives.

23%

28%17%

4%

5%

15%

8% UK Equities


Alternatives

Commodities

UK Fixed Interest


Cash


5/8

MCIM Balanced Adventurous Portfolio JULY 2012


2012 PERFORMANCE

INVESTMENT MANAGERS












IMPORTANT INFORMATION This information has been approved for distributionto retail and professional investors only. Theinformation in this document is believed to be correctbut cannot be guaranteed. Past performance is not aguide to future performance and may not berepeated. The value of investments and the incomefrom them may go down as well as up and investorsmay not get back the amounts originally invested.Before contemplating any transaction, you shouldconsult your financial adviser. This material is notintended as an offer or solicitation for the purchase orsale of any security or any other action, without firstseeking advice as to the suitability of it for your needs.*Clients portfolios may differ from model portfoliosdependent on their s pecific objectives.

ASSET ALLOCATION

25%

30%16%

3%

5%

14%

7% UK Equities


Alternatives

Commodities

UK Fixed Interest


Cash


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MCIM Balanced Highly Adventurous Portfolio JULY 2012


2012 PERFORMANCE

INVESTMENT MANAGERS









ASSET ALLOCATION




MPORTANT INFORMATION This information has been approved for distribution toretail and professional investors only. The informationin this document is believed to be correct but cannotbe guaranteed. Past performance is not a guide tofuture performance and may not be repeated. Thevalue of investments and the income from them maygo down as well as up and investors may not get back the amounts originally invested. Beforecontemplating any transaction, you should consultyour financial adviser. This material is not intended asan offer or solicitation for the purchase or sale of any

security or any other action, without first seekingadvice as to the suitability of it for your needs.*Clients portfolios may differ from model portfoliosdependent on their specific objectives.

27%

33%

15%

3%4%

13%

5% UK Equities


Alternatives

Commodities

UK Fixed Interest


Cash


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MCIM Balanced Speculative Portfolio JULY 2012


2012 PERFORMANCE

INVESTMENT MANAGERS


Selection Committees for over 9 years and formerchairman of those committees at BWD Rensburg, heholds a MSC in Investment Analysis and is anAssociate Member of the Society of InvestmentProfessionals (ASIP).







ASSET ALLOCATION




IMPORTANT INFORMATION This information has been approved for distributionto retail and professional investors only. Theinformation in this document is believed to becorrect but cannot be guaranteed. Past performanceis not a guide to future performance and may not berepeated. The value of investments and the incomefrom them may go down as well as up and investorsmay not get back the amounts originally invested.Before contemplating any transaction, you shouldconsult your financial adviser. This material is notintended as an offer or solicitation for the purchase orsale of any security or any other action, without firstseeking advice as to the suitability of it for yourneeds.*Clients portfolios may differ from model portfoliosdependent on their specific objectives.

35%

43%

9%

2%1% 7%

4% UK Equities


Alternatives

Commodities

UK Fixed Interest


Cash


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MCIM Enhanced Income Portfolio JULY 2012


12 MONTH PERFORMANCE

INVESTMENT MANAGERS


Selection Committees for over 9 years and formerchairman of those committees at BWD Rensburg, heholds a MSC in Investment Analysis and is anAssociate Member of the Society of InvestmentProfessionals (ASIP).




.


Myddleton Croft Ltd is authorised and regulated by the Financial Services Authority. Registered in England & Wales number 05782909. VAT number UK 889 241088.R i d ffi 11 Cliff d A Ilkl LS29 0AS

ASSET ALLOCATION

The Enhanced Income Portfolio was launched at the beginning of 2011. It should be noted thatthe performance before that date (presented above) is from the back-tested portfolio and isprovided for illustration purposes only.




IMPORTANT INFORMATION This information has been approved for distributionto retail and professional investors only. Theinformation in this document is believed to be correctbut cannot be guaranteed. Past performance is not aguide to future performance and may not berepeated. The value of investments and the incomefrom them may go down as well as up and investorsmay not get back the amounts originally invested.Before contemplating any transaction, you shouldconsult your financial adviser. This material is notintended as an offer or solicitation for the purchase orsale of any security or any other action, without firstseeking advice as to the suitability of it for your needs.*Clients portfolios may differ from model portfoliosdependent on their specific objectives.

5%5%

15%

5%

20%

45%

5%UK Equities


Alternatives

CommoditiesUK Fixed Interest


Cash

direct factsheet july 12

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