Aug-24: Insights

Read the latest Avastra Fund insights on Markets, Equities, Bonds and Alternatives for August 2024.

August 2024 Update

​​For UK professional investors only 

MARKETS

​Markets recovered their poise after an early August shake-out driven by rapid deleveraging.

Selectivity within US equities, and diversification from UK equities can help mitigate “concentration” risk.

Global and UK Bonds had a strong month on moderating inflation and the first UK rate cut in August and expected US rate cuts in September.

EQUITIES

​ The VT Avastra Global Equity Fund returned +0.65% for the month and is +9.36% YTD. During the month we made the following adjustments to the fund:

• Introduced Orbis Global Equity fund as its contrarian approach as consistently delivered ‘Alpha’.
  
• Introduced Berkshire Hathaway direct equity as well as Future of Defence ETF as geopolitical tensions remain.
  
• Switched from World Size factor to FTSE 250 as UK rate cuts improve outlook and sentiment for smaller cap equities.

The fund provides a “4-in-1” active allocation strategy across Regional, Sector, Factor and Manager strategies. 

BONDS

​The VT Avastra Global Fixed Income Fund returned +0.22% for the month and is +1.62% YTD. During the month we made the following adjustments to the fund:

• Switched out from Money Market allocations to Emerging Market USD debt which have historically performed well during Fed rate cutting cycles.

The fund provides an active allocation approach to managing duration and credit quality exposure within the Bond sector.

​ALTERNATIVES

​The VT Avastra Global Alternatives Fund returned +0.27% for the month and is +5.85% YTD. During the month we made the following adjustments to the fund:

• Switched out from MAN GLG Alpha Select Alternative as performance has lagged and the fund has given up its outperformance. Introduced Ruffer Investment Company Trust for its tail risk hedges. 

The fund provides both asset-based and risk-based diversification, as an alternative to equities and bonds.