Levitas Portfolio Update - Q1 2020

Levitas A

The portfolio declined over the quarter underperforming the IA Flexible sector

The first quarter of 2020 provided an unprecedented unfolding of events. We have seen equity markets reach new closing highs, only to be followed in record time with a sell-off into bear market territory as economies have essentially been shut down to try and contain the spread of COVID-19. This threatens to tip global economic activity into recession with significant impacts to quarter-on-quarter growth rates.

Policy makers have sought to limit the long-term damage to their economies. Whilst neither monetary nor fiscal policy can prevent the inevitable near-term collapse in economic activity such action can limit any long-term damage, as well as speed the recovery once normal economic and societal behaviour returns. While we cannot know with any certainty when we might see the end of COVID-19, we do know that an end will come. For investors, now more than ever, it is important to remain disciplined in the current market environment.

Risk assets declined heavily over the quarter. Parts of the portfolio that were impacted particularly hard were equities with exposure to Asian, UK, higher risk smaller companies and funds with a ‘value’ bias to its investment approach. Assets with exposure to foreign currency tended to perform better as sterling depreciated. The portfolios main thematic positions of Technology and Healthcare also performed well.

We have made limited changes to the portfolio over the quarter. Assets have sold off heavily but we expect these to recover quickly once sentiment starts to change, as witnessed by the last week or so of the quarter. We have been unwilling to fund new positions by selling assets that have fallen but fundamentally remain sound. We continue to feel that the portfolio is well positioned once market sentiment improves.

Levitas B

The portfolio declined over the quarter but outperformed the IA 0-35% Sector.

The first quarter of 2020 provided an unprecedented unfolding of events. We have seen equity markets reach new closing highs, only to be followed in record time with a sell-off into bear market territory as economies have essentially been shut down to try and contain the spread of COVID-19. This threatens to tip global economic activity into recession with significant impacts to quarter-on-quarter growth rates.

Policy makers have sought to limit the long-term damage to their economies. Whilst neither monetary nor fiscal policy can prevent the inevitable near-term collapse in economic activity such action can limit any long-term damage, as well as speed the recovery once normal economic and societal behaviour returns. While we cannot know with any certainty when we might see the end of COVID-19, we do know that an end will come. For investors, now more than ever, it is important to remain disciplined in the current market environment.

Back To List

Comments (1)

26 Apr, 2020 at 8:20am

Whilst you detailed how Levitas B had outperformed the benchmark and by how. But on levitas A you had underperformed but said nothing by how much it had underperformed. Transparency would be much appreciated

Submit a comment

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.

Topics

Auto-enrolment? We can help
Get in touch with Aspira