Here’s our update on what's been happening in the markets and how our range of Ready-made Investment (RMI) funds are performing.
Remember the value of investments can fall as well as rise. You may not get back what you invest. We're not recommending Ready-made Investments as being suitable for you based on your personal circumstances, nor do we offer personal financial advice.
If you're unsure about this investment’s suitability for you, or you’re not confident about making your own investment decisions, you should seek independent advice.
The third quarter delivered unexpected developments, from an attempted assassination of former President Trump to China’s aggressive economic actions. Despite broad expectations of a quiet quarter playing out, it ended up packed with significant events that shaped markets and outlooks.
Emerging market equities, fuelled by China’s aggressive measures to combat its property crisis, finished the quarter ahead of their developed markets peers. Although China’s interventions sparked a sharp rally, uncertainty lingers about whether these measures will have lasting effects and address the issues facing China’s economy, including the ongoing property crisis and deflationary (falling prices) concerns.
The US election race remains closely contested, with both economic and political outcomes uncertain. Regardless, diversification across geographies and asset classes is the only real protection for investors against country-specific policy risk. Despite the political drama, the economy defied recession expectations, with growth exceeding forecasts and inflation easing, signalling continued resilience.
The rapid evolution of Artificial Intelligence and machine learning continues, with applications in healthcare and logistics advancing. However, much of the debate has zeroed in on the costs over the last few months. The related data centre and wider infrastructure costs are expensive to say the least. Only time will tell how, or if, this will impact long-term valuations.
Escalating conflict in the Middle East has yet to translate into significant market disruptions. Oil’s diminished role in gross domestic product (GDP) growth, as well as strategic reserves, have so far kept energy prices stable, but the risk of further escalation remains.
Germany faces significant recession risks, with weak industrial performance dragging down the broader European economy. Though Italy and Spain offer some bright spots, they are not large enough to offset Germany’s struggles.
Our Strategic Asset Allocation (SAA) is our optimum mix of shares, bonds and cash, designed to give you the best portfolio outcome for the long term. While our Tactical Asset Allocation (TAA) is the process where we actively deviate from our SAA, in order to take advantage of short-term investment opportunities.
During the third quarter, we made just one change on a tactical basis. We recently reduced our exposure to the British pound (GBP) in favour of the US dollar (USD) for three key reasons.
First, we believe that the market is overly optimistic of UK growth expectations versus the US. While recent US job data suggests the market’s view might be somewhat accurate, such extreme differences tend to balance out over time, which could hurt the value of GBP against USD.
Second, interest rate expectations are likely to move in favour of the US.
And third, investors are extremely optimistic on sterling, while simultaneously too pessimistic on the US dollar. This imbalance means that if the economic outlook worsens, GBP could fall quickly against USD.
You can relax in the knowledge that we will continue to monitor and manage your RMI fund in line with its objectives. We’ll update you regularly on their performance and any changes we’ve made.
Of course, if you’d like to see the latest performance of your investments, simply log-in to your Smart Investor account any time.
This Ready-made Investment takes a low-risk approach, aiming for modest growth in the value of your investment in the medium to long term, while seeking to protect your capital. Its approach is to invest in a blend of passive funds giving you access to different asset classes from around the world. It invests mostly in cash and bonds, with some exposure to shares, mostly in developed markets.
|
Year from 30 September |
2023-24 |
2022-23 |
2021-22 |
2020-21 |
2019-20 |
|---|---|---|---|---|---|
|
Fund (net) |
8.99 |
4.27 |
-11.22 |
4.34 |
2.87 |
|
1 Month |
3 Months |
6 Months |
1 Year |
3 Years p.a. |
5 Years p.a. |
|---|---|---|---|---|---|
|
0.74 |
2.26 |
3.35 |
8.99 |
0.30 |
1.61 |
Source: Morningstar as at 30 September 2024
The table shows the performance of the accumulation units of the fund, on a total returns basis. Past performance of investments is not a reliable indicator of their future performance.
This Ready-made Investment choice means you’ll be taking more risk than Barclays Wealth Growth Markets 1. It aims to achieve better returns than cash over the longer term, but also seeks to reduce the risk of significant capital loss. It still has a high exposure to lower-risk assets, investing largely in bonds but also gives some exposure to shares, primarily developed market shares.
|
Year from 30 September |
2023-24 |
2022-23 |
2021-22 |
2020-21 |
2019-20 |
|---|---|---|---|---|---|
|
Fund (net) |
11.78 |
4.88 |
-10.77 |
7.86 |
3.12 |
|
1 Month |
3 Months |
6 Months |
1 Year |
3 Years p.a. |
5 Years p.a. |
|---|---|---|---|---|---|
|
0.72 |
2.00 |
3.38 |
11.78 |
1.51 |
3.07 |
Source: Morningstar as at 30 September 2024
The table shows the performance of the accumulation units of the fund, on a total returns basis. Past performance of investments is not a reliable indicator of their future performance.
With this Ready-made Investment choice, you’re taking a moderate level of risk to seek long-term growth. There’s more exposure to riskier investments than in our lower risk profile Ready-made Investments, but it’s still well diversified to try to mitigate some of that risk. At this level, short-term changes in value are more likely and while you’ll be invested in both bonds and shares, it’ll lean more towards the latter.
|
Year from 30 September |
2023-24 |
2022-23 |
2021-22 |
2020-21 |
2019-20 |
|---|---|---|---|---|---|
|
Fund (net) |
14.61 |
7.25 |
-9.24 |
11.94 |
3.70 |
|
1 Month |
3 Months |
6 Months |
1 Year |
3 Years p.a. |
5 Years p.a. |
|---|---|---|---|---|---|
|
1.01 |
1.89 |
3.91 |
14.61 |
3.72 |
5.31 |
Source: Morningstar as at 30 September 2024
The table shows the performance of the accumulation units of the fund, on a total returns basis. Past performance of investments is not a reliable indicator of their future performance.
This Ready-made Investment takes a moderate-high approach to risk, aiming to generate higher growth than our lower risk options. To offer the potential for bigger rewards, it introduces more risk, which also means more chance of experiencing losses. It invests largely in shares, making up more than half of your investment and while it still gives some exposure to lower-risk investments like bonds, they’ll be a smaller section of your overall investment.
|
Year from 30 September |
2023-24 |
2022-23 |
2021-22 |
2020-21 |
2019-20 |
|---|---|---|---|---|---|
|
Fund (net) |
15.94 |
9.03 |
-7.53 |
15.95 |
3.71 |
|
1 Month |
3 Months |
6 Months |
1 Year |
3 Years p.a. |
5 Years p.a. |
|---|---|---|---|---|---|
|
1.04 |
1.38 |
3.90 |
15.94 |
5.34 |
7.04 |
Source: Morningstar as at 30 September 2024
The table shows the performance of the accumulation units of the fund, on a total returns basis. Past performance of investments is not a reliable indicator of their future performance.
With this Ready-made Investment you’re taking a high level of risk, seeking to achieve substantial long-term growth. Most of the holdings will be in higher risk investments and you may experience considerable day-to-day fluctuations in value. As you’re chasing bigger rewards, there’s also a bigger chance of experiencing losses. With this option, significantly more than half of the fund will be in shares and although there’s some exposure to fixed-income investments, it’s mostly in emerging markets bonds.
|
Year from 30 September |
2023-24 |
2022-23 |
2021-22 |
2020-21 |
2019-20 |
|---|---|---|---|---|---|
|
Fund (net) |
17.00 |
9.76 |
-6.15 |
19.03 |
3.77 |
|
1 Month |
3 Months |
6 Months |
1 Year |
3 Years p.a. |
5 Years p.a. |
|---|---|---|---|---|---|
|
1.05 |
0.86 |
4.07 |
17.00 |
6.42 |
8.28 |
Source: Morningstar as at 30 September 2024
The table shows the performance of the accumulation units of the fund, on a total returns basis. Past performance of investments is not a reliable indicator of their future performance.
|
Fund |
Cash & Short Maturity Bonds |
Developed Government Bonds |
Investment Grade Bonds |
High Yield & Emerging Market Bonds |
Developed Markets Equities |
Emerging Markets Equities |
|---|---|---|---|---|---|---|
|
Global Markets Defensive |
66.0 |
4.0 |
10.0 |
2.0 |
13.0 |
5.0 |
|
Global Markets Cautious |
33.0 |
5.0 |
22.0 |
2.0 |
27.0 |
11.0 |
|
Global Markets Balanced |
2.0 |
7.0 |
33.0 |
2.0 |
40.0 |
16.0 |
|
Global Markets Growth |
2.0 |
5.0 |
18.0 |
2.0 |
51.0 |
22.0 |
|
Global Markets Adventurous |
2.0 |
3.0 |
4.0 |
2.0 |
61.0 |
28.0 |
Please note: The actual asset allocation may deviate from those weights shown due to intentional shifts we make to take advantage of short-term opportunities and risks, as we see them.
You can buy your Ready-made Investment using an existing account.
You can choose from two types of account. Once your account is open, you can buy your chosen Ready-made Investment.
The most popular account people choose when they start to invest.
You can pay in up to £20,000 per tax year into our award-winning ISA.
Any returns you make are tax free.
Tax rules can change in future and their effects on you will depend on your indvidual circumstances.
A flexible account if you’ve already used your ISA allowance for the current tax year or you’re already paying into an ISA with another provider.
No limits on the amount you can invest.
The return you make on your investments will be taxable but there are allowances that may mean you don’t pay tax, or it's reduced.1
Smart Investor is an investment service for UK residents aged 18 or over. The service is not available to US persons, even if they are resident in the UK.
