SQM Research Newsletter and Ratings Update - April 2021
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In taking a helicopter view of the markets and products in Q1 2021 the clear and obvious conclusion is: its good to be a risk asset! (see our return tables later on for markets, ETFs and SQM-rated funds)
Markets were RISK ON all the way:
Fixed Income BAD (except for high yield)
Credit GOOD, Duration BAD
Equity GOOD (including REITs and Infra)
Highlights
Risk assets did extremely well in March – gigantic stimulus of both the monetary and fiscal variety have turbo-charged markets, including non-traditional stuff like Bitcoin and NFTs.
A-REITs 6%+ for the month
Infrastructure 5-6%
US Equity 6%
World DM 5%(ish)
Small Cap 4-5%
Global HY 4.6% (for a fixed income market!)
Lowlights
China EQ -4.7%
Bonds Negative!
Everything crushes inflation! Except for fixed income, which barely got over the line.
SQM Research - Market Benchmarks
Mar-21
What About ETFs?
Huge dispersion of returns over the year: from a high of 146% to a low of -42%. That’s a range of 188%
Dominated by Equities
Geared US equities (146% for the year!)
Geared Australian equities (92.9% for the year!)
FANG (73%)
Anything tech-related
small cap and micro cap
Vanguard Global Value Equity 51%+ !! (no. 22 on our ETF list)
Australian banks! 60%
Fixed Income
Currency
Precious Metals (its all crypto now!)
Hedges Gone Wrong!
SQM Research - Top 50 ETFs Ranked by 1 Year Total Return
at Mar-21
Top 5 SQM Rated Funds by Asset Class
Alternatives posting some pretty spectacular results after a long spell in the wilderness
A-REITs made a stunning comeback - thank you low rates and a re-opening economy
Fixed income dominated by credit – especially anything high yield
G-REITs and Infra posting strong returns (high teens to mid-thirties)
Equites dominated by small and micro-cap and disruption-themed funds
Mortgage Trusts - single digits but healthy margins over cash
Multi-Asset - crushing inflation objectives
SQM Research - Top 5 Rated Funds Ranked by 1 Year Total Return
* Funds with international investments can have dissimilar FX hedging patterns, from hedged to unhedged or variable hedging.
This may have an impact on fund returns. Please refer to the Fund’s product disclosure statement for details.
Discontinued or Not Renewed
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