Q4 2019
TPC Model Portfolios
INTEGRITY • VIGILANCETavistock Investments Plc Group
CONTENTS TAVISTOCK PRIVATE CLIENT 2
TAVISTOCK WEALTH 3
HOW TPC WORK WITH TWL 4
TPC MODEL PORTFOLIOS - HOW THEY COMPARE 5
THE SIGNIFICANCE OF CURRENCY HEDGING 6
INVESTING IN THE TPC MODEL PORTFOLIOS 7
TPC RISK LEVEL 3 8
TPC RISK LEVEL 4 10
TPC RISK LEVEL 5 12
TPC RISK LEVEL 6 14
TPC RISK LEVEL 7 16
TPC RISK LEVEL 8 18
TPC INCOME 20
TPC EQUITY GROWTH 22
MANAGER COMMENTARY 24
CHARGES 24
GLOSSARY OF TERMS 25
TPC MODEL PORTFOLIOSQUARTERLY PERFORMANCE
TAVISTOCK PRIVATE CLIENT
TAVISTOCK PRIVATE CLIENT (TPC) MODEL PORTFOLIOSThe TPC Model Portfolios are risk progressive and designed to cater for the varying risk appetite of different investors. Each TPC Model Portfolio provides actively managed multi-asset diversification across equity, bond, commodity and property markets globally, with a blend of index tracking regulated collective investment schemes through Exchange Traded Funds (ETFs) and cash.
OUR INVESTMENT APPROACHWe base investment decisions on our strategic, long term views. We have a preference for index tracking investment products because they provide low-cost exposure to a comprehensive range of assets and markets. Over time, this strategy has provided our portfolios with consistent investment returns in a risk controlled manner.
INVESTMENT OBJECTIVE AND STRATEGY Objective: All TPC Model Portfolios seek to deliver returns above inflation over a rolling five-year period. The margin sought increases with the more risk you take on.
Strategy: The TPC Model Portfolios employ a strategy of diversification across a wide range of asset classes and geographic regions through the use of ETF’s on a medium to long term basis (five years or more).
We believe that through using index-tracking products we reduce investment management costs, remove individual stock risk and avoid the risk of using underperforming active investment managers. TPC Model Portfolios are not suitable for money which might be needed in the short term. The value and your investment can go down as well as up and you may not get back what you originally invested.
ABOUT TAVISTOCK WEALTHYour TPC Model Portfolio is managed through Tavistock Wealth. Tavistock Wealth provide all TPC investors with high quality professional investment management along with significant collective buying power resulting in a highly cost effective portfolio.
2
TAVISTOCK WEALTH
TAVISTOCK GROUP STRUCTUREThe Group has separate investment management and advisory businesses. Tavistock Wealth delivers institutional quality portfolio management at a retail price. Tavistock Wealth Global provides discretionary investment services outside the UK. Our advisory businesses provide compliance, administration and accounting services to independent financial advisers (Tavistock Partners) and to financial advice firms (The Tavistock Partnership). Tavistock Private Client is a multi-award winning practice that provides independent financial advice and investment management services to higher net worth private clients.
INVESTMENT TEAM
Christopher Peel is the Chief Investment Officer of Tavistock Wealth and carries direct responsibility
for all discretionary investments at the firm. Together with John Leiper, CFA, Head of Portfolio
Management, and the portfolio management team, they co-manage the risk progressive range
of ACUMEN Portfolios (UCITS funds) and the TPC Model Portfolios. Christopher is an economics
graduate with more than 30 years’ experience in financial markets, managing both multi-asset
traditional and alternative funds, having held senior management positions at both Citibank and
Salomon Brothers. John has over 10 years’ experience in the investment management industry and is
a CFA® charterholder.
3
4
5
THE SIGNIFICANCE OF CURRENCY HEDGING
When is your portfolio subjected to currency risk?• A globally diversified portfolio will be subject to currency risk whenever the portfolio
owns assets denominated in a currency other than sterling
What is the risk to your portfolio?
The risk to your portfolio is that returns can be driven from the movement in currency markets.
A gain made through asset allocation can be wiped out through currency fluctuations potentially
making the strategy upon which the portfolio is constructed redundant.
Consequently, your portfolio may be subjected to movements in currency markets when you are
least expecting it and you could see your investments losing money when expecting to make gains
when you see, for example, overseas equity markets appreciate in value.
The last thing we want to see is your portfolio experiencing ‘Risk Profile 8’ volatility when we have
recommended a ‘Risk Profile 5’.
It’s all about you.
6
TPC MODEL PORTFOLIOS RISK vs RETURN
INVESTING IN THE TPC MODEL PORTFOLIOS
CURRENCY HEDGED
CURRENCY NOT HEDGED
TPC Model Portfolios are managed to Dynamic Planner’s expected volatility range and relative to their respective market composite benchmarks. In order to remain within the defined volatility ranges, the Portfolios hedge their overseas currency exposure back to sterling. If overseas exposure is not hedged the currency markets will impact the returns of the portfolio, and more importantly, the level of volatility the portfolio takes.
Baskets of ETFs constructed by Tavistock primarily using • Market leading range of ETFs
Mitigation of foreign exchange risk through currency hedging:
• Ensuring asset allocation is the driver of returns (rather than currency moves)
Managed to the European regulatory gold standard - UCITS Compliant:• Investment safeguards continually protecting client holdings
Managed to Dynamic Planner’s expected volatility range:• Volatility bands that match the attitude to risk profiles of individual clients
TPC 3
TPC 4
TPC 5
TPC 6
TPC 7
TPC 8
TPC Income
Expected Annualised Volatility Range
7
Esti
mat
ed A
nnua
lised
Ret
urn
ASSET ALLOCATION
REGION ALLOCATION
TPC MODEL PORTFOLIO BENEFITS:
The TPC Risk Level 3 portfolio is managed to Dynamic Planner’s volatility range of 4.20% to 6.30% and has a blended allocation to the range of ACUMEN Portfolios.
RISK PROFILE
8
Government Bonds
Corporate Bonds
Inflation-Linked Bonds
Emerging Market Bonds
Developed Market Equities
Emerging Market Equities
Commodity Equities
Property Equities
Cash
North America
United Kingdom
Europe ex UK
Asia ex Japan
Japan
Rest of World
TPC Risk Level 3
The investment objective of the TPC Risk Level 3 portfolio is to seek to deliver long term capital growth by investing in a range of global financial markets. The portfolio is actively managed and comprised of multi-asset investments. The portfolio is typically comprised of lower and medium risk investments such as cash, bonds and property as well as a few higher risk investments such as equities and commodities.
INVESTMENT OBJECTIVE
Asset allocation, rather than stock selection, is the key driver of risk and returns and the TPC Model Portfolios are structured accordingly, in line with the Investment Association’s Sector guidelines. Each portfolio is comprised of holdings in the risk progressive ACUMEN Portfolios, which invest in highly diversified baskets of ETFs providing cost effective and tax efficient exposure to global markets. The ACUMEN Portfolios are constructed by Tavistock primarily using
INVESTMENT PHILOSOPHY
On the 30/09/2018 the PBFP Risk Level 1 Portfolio changed its name to the TPC Risk Level 3 Portfolio. The objective and risk parameters of the model portfolio are unchanged.
Industry Leading Risk Management• Comprehensive risk management via a series of in-
house asset class dashboards• Rigorous quantitative analysis using AlternativeSoft
with data from Thomson Reuters Eikon and Lipper for Investment Management
• Relative value technical analysis using Tradesignal
Hedged Currency Exposure• Majority of Overseas portfolio exposure hedged
back to GBP• No unexpected risks within the portfolio• Ensuring portfolio will remain aligned with
specific volatility target
Monitoring of Portfolio• A team of investment professionals will monitor
the portfolio every trading day of the year• Any potential impact of financial markets can be
assessed in real-time• Improvements to portfolios can be identified
quickly
Active Management• Tavistock Private Client can make changes to the
portfolio as required• Enables us to react to markets quickly on your
behalf• Affording you additional protection during times
of market volatility
5.0%
44.0%
25.5%
6.5%
2.5%14.0%
2.5%
48.0%
10.5%
22.5%
4.5%10.5%
4.0%
75
100
125
150
175
75
100
125
150
175
Jan-
08
Jun-
08
No
v-08
Apr
-09
Sep-
09
Feb-
10
Jul-
10
Dec
-10
May
-11
Oct
-11
Mar
-12
Aug
-12
Jan-
13
Jun-
13
No
v-13
Apr
-14
Sep-
14
Feb-
15
Jul-
15
Dec
- 15
May
-16
Oct
-16
Mar
-17
Aug
-17
Jan-
18
Jun-
18
No
v-18
Apr
-19
Sep-
19
9
iShares Fallen Angels High Yield Corp BondiShares Global Govt BondiShares Global High Yield Corporate BondiShares US Mortgage Backed SecuritiesXtrackers II Japan Government Bond
TOP 5 HOLDINGS
Date of data: 30th September 2019. Source of data: Tavistock Private Client and Tavistock Wealth Limited, Thomson Reuters and Lipper for Investment Management. The TPC Model Portfolio returns are quoted net of fees. *The Market Composite Benchmark (GBP Hedged) is the Sterling Overnight Index Average (5%), Bloomberg Barclays Global Aggregate Bond GBP Hedged Index (65%) Bloomberg Barclays Global High Yield GBP Hedged Index (20%). MSCI World GBP Hedged (8%) and the MSCI Emerging Market Investable Markets Index (2%).
TPC Risk Level 3IA Mixed Investment 0-35% Shares
Market Composite Benchmark*
TPC Risk Level 3
18th February 2008 - 30th September 2019 TPC Risk Level 3
Annualised Return (%) 4.23Volatility (%) 4.96
Downside Risk (%) 4.61Max Drawdown (%) -6.78
Max Gain (%) 7.84Max Loss (%) -5.00
Negative Periods 38.85Positive Periods 61.15
1 year 3 year 5 year ITD
2.05% 3.98% 15.02% 61.67%
Performance
TPC Risk Level 4
The TPC Risk Level 4 portfolio is managed to Dynamic Planner’s volatility range of 6.30% to 8.40% and has a blended allocation to the range of ACUMEN Portfolios.
RISK PROFILE
10
Asset allocation, rather than stock selection, is the key driver of risk and returns and the TPC Model Portfolios are structured accordingly, in line with the Investment Association’s Sector guidelines. Each portfolio is comprised of holdings in the risk progressive ACUMEN Portfolios, which invest in highly diversified baskets of ETFs providing cost effective and tax efficient exposure to global markets. The ACUMEN Portfolios are constructed by Tavistock primarily using
ASSET ALLOCATION
Government Bonds
Corporate Bonds
Inflation-Linked Bonds
Emerging Market Bonds
Developed Market Equities
Emerging Market Equities
Commodity Equities
Property Equities
Cash
TPC MODEL PORTFOLIO BENEFITS:
REGION ALLOCATION
North America
United Kingdom
Europe ex UK
Asia ex Japan
Japan
Rest of World
The investment objective of the TPC Risk Level 4 portfolio is to seek to deliver long term capital growth by investing in a range of global financial markets. The portfolio is actively managed and comprised of multi-asset investments. The portfolio is typically comprised of lower and medium risk investments such as cash, bonds and property as well as a few higher risk investments such as equities and commodities.
INVESTMENT OBJECTIVE
INVESTMENT PHILOSOPHY
On the 30/09/2018 the PBFP Risk Level 2 & 3 Portfolios changed their name to the TPC Risk Level 4 Portfolio. The objective and risk parameters of the model portfolio are unchanged.
Industry Leading Risk Management• Comprehensive risk management via a series of in-
house asset class dashboards• Rigorous quantitative analysis using AlternativeSoft
with data from Thomson Reuters Eikon and Lipper for Investment Management
• Relative value technical analysis using Tradesignal
Hedged Currency Exposure• Majority of Overseas portfolio exposure hedged
back to GBP• No unexpected risks within the portfolio• Ensuring portfolio will remain aligned with
specific volatility target
Monitoring of Portfolio• A team of investment professionals will monitor
the portfolio every trading day of the year• Any potential impact of financial markets can be
assessed in real-time• Improvements to portfolios can be identified
quickly
Active Management• Tavistock Private Client can make changes to the
portfolio as required• Enables us to react to markets quickly on your
behalf• Affording you additional protection during times
of market volatility
5.5%
30.0%
12.5%
4.5%1.5%
43.0%
3.0%
52.5%
10.5%
18.0%
4.5%10.5%
4.0%
75
100
125
150
175
75
100
125
150
175
Jan-
08
Jun-
08
Nov
-08
Apr
-09
Sep-
09
Feb-
10
Jul-
10
Dec
-10
May
-11
Oct
-11
Mar
-12
Aug
-12
Jan-
13
Jun-
13
Nov
-13
Apr
-14
Sep-
14
Feb-
15
Jul-
15
Dec
-15
May
-16
Oct
-16
Mar
-17
Aug
-17
Jan-
18
Jun-
18
Nov
-18
Apr
-19
Sep-
19
11
iShares Edge MSCI World Minimum Volatility
iShares Edge MSCI World Quality Factor
iShares Fallen Angels High Yield Corp Bond
iShares US Mortgage Backed Securities
MS SciBeta HFE US Equity 6F EW
TPC Risk Level 4
18th February 2008 - 30th September 2019 TPC Risk Level 4
Annualised Return (%) 4.47Volatility (%) 5.89
Downside Risk (%) 5.97Max Drawdown (%) -9.67
Max Gain (%) 7.35Max Loss (%) -5.45
Negative Periods 38.85Positive Periods 61.15
1 year 3 year 5 year ITD
2.80% 7.58% 20.11% 65.96%
Performance
TOP 5 HOLDINGS
Date of data: 30th September 2019. Source of data: Tavistock Private Client and Tavistock Wealth Limited, Thomson Reuters and Lipper for Investment Management. The TPC Model Portfolio returns are quoted net of fees. *The Market Composite Benchmark (GBP Hedged) is the Sterling Overnight Index Average (5%), Bloomberg Barclays Global Aggregate Bond GBP Hedged Index (42.5%), Bloomberg Barclays Global High Yield GBP Hedged Index (7.5%), MSCI World GBP Hedged (42%) and the MSCI Emerging Market Investable Markets Index (3%).
TPC Risk Level 4IA Mixed Investment 20-60% Shares
Market Composite Benchmark*
TPC Risk Level 5
The TPC Risk Level 5 portfolio is managed to Dynamic Planner’s volatility range of 8.40% to 10.50% and has a blended allocation to the range of ACUMEN Portfolios.
RISK PROFILE
12
ASSET ALLOCATION
Government Bonds
Corporate Bonds
Inflation-Linked Bonds
Emerging Market Bonds
Developed Market Equities
Emerging Market Equities
Commodity Equities
Property Equities
Cash
TPC MODEL PORTFOLIO BENEFITS:
REGION ALLOCATION
North America
United Kingdom
Europe ex UK
Asia ex Japan
Japan
Rest of World
The investment objective of the TPC Risk Level 5 portfolio is to seek to deliver long term capital growth by investing in a range of global financial markets. The portfolio is actively managed and comprised of multi-asset investments. The portfolio is typically comprised of lower and medium risk investments such as cash, bonds and property as well as higher risk investments such as equities and commodities.
INVESTMENT OBJECTIVE
Asset allocation, rather than stock selection, is the key driver of risk and returns and the TPC Model Portfolios are structured accordingly, in line with the Investment Association’s Sector guidelines. Each portfolio is comprised of holdings in the risk progressive ACUMEN Portfolios, which invest in highly diversified baskets of ETFs providing cost effective and tax efficient exposure to global markets. The ACUMEN Portfolios are constructed by Tavistock primarily using
INVESTMENT PHILOSOPHY
On the 30/09/2018 the PBFP Risk Level 4 Portfolio changed its name to the TPC Risk Level 5 Portfolio. The objective and risk parameters of the model portfolio are unchanged.
Industry Leading Risk Management• Comprehensive risk management via a series of in-
house asset class dashboards• Rigorous quantitative analysis using AlternativeSoft
with data from Thomson Reuters Eikon and Lipper for Investment Management
• Relative value technical analysis using Tradesignal
Hedged Currency Exposure• Majority of Overseas portfolio exposure hedged
back to GBP• No unexpected risks within the portfolio• Ensuring portfolio will remain aligned with
specific volatility target
Monitoring of Portfolio• A team of investment professionals will monitor
the portfolio every trading day of the year• Any potential impact of financial markets can be
assessed in real-time• Improvements to portfolios can be identified
quickly
Active Management• Tavistock Private Client can make changes to the
portfolio as required• Enables us to react to markets quickly on your
behalf• Affording you additional protection during times
of market volatility
5.5%
19.0%
12.0%
2.5%
2.0%
51.5%
6.0% 1.5%
54.0%
11.0%
15.0%
6.5%
7.0%6.5%
75
100
125
150
175
200
75
100
125
150
175
200
Jan-
08
Jun-
08
Nov
-08
Apr
-09
Sep-
09
Feb-
10
Jul-
10
Dec
-10
May
-11
Oct
-11
Mar
-12
Aug
-12
Jan-
13
Jun-
13
Nov
-13
Apr
-14
Sep-
14
Feb-
15
Jul-
15
Dec
-15
May
-16
Oct
-16
Mar
-17
Aug
-17
Jan-
18
Jun-
18
Nov
-18
Apr
-19
Sep-
19
13
TOP 5 HOLDINGS
iShares Edge MSCI World Minimum Volatility
iShares Edge MSCI World Quality Factor
iShares MSCI USA Quality Dividend
iShares US Mortgage Backed Securities
MS SciBeta HFE US Equity 6F EW
TPC Risk Level 5
18th February 2008 - 30th September 2019 TPC Risk Level 5
Annualised Return (%) 4.94Volatility (%) 6.82
Downside Risk (%) 7.20Max Drawdown (%) -12.88
Max Gain (%) 6.94Max Loss (%) -6.60
Negative Periods 35.25Positive Periods 64.75
1 year 3 year 5 year ITD
3.50% 11.51% 25.34% 74.83%
Performance
Date of data: 30th September 2019. Source of data: Tavistock Private Client and Tavistock Wealth Limited, Thomson Reuters and Lipper for Investment Management. The TPC Model Portfolio returns are quoted net of fees. *The Market Composite Benchmark (GBP Hedged) is the Sterling Overnight Index Average (5%), Bloomberg Barclays Global Aggregate Bond GBP Hedged Index (30%) Bloomberg Barclays Global High Yield GBP Hedged Index (5%). MSCI World GBP Hedged (53%) and the MSCI Emerging Market Investable Markets Index (7%).
TPC Risk Level 5IA Mixed Investment 20-60% Shares
Market Composite Benchmark*
TPC Risk Level 6
The TPC Risk Level 6 portfolio is managed to Dynamic Planner’s volatility range of 10.50% to 12.60% and has a blended allocation to the range of ACUMEN Portfolios.
RISK PROFILE
14
ASSET ALLOCATION
Government Bonds
Corporate Bonds
Inflation-Linked Bonds
Emerging Market Bonds
Developed Market Equities
Emerging Market Equities
Commodity Equities
Property Equities
Cash
TPC MODEL PORTFOLIO BENEFITS:
REGION ALLOCATION
North America
United Kingdom
Europe ex UK
Asia ex Japan
Japan
Rest of World
The investment objective of the TPC Risk Level 6 portfolio is to seek to deliver long term capital growth by investing in a range of global financial markets. The portfolio is actively managed and comprised of multi-asset investments. The portfolio is typically comprised of higher risk investments such as equities and commodities but will also contain a few lower and medium risk investments such as cash, bonds and property.
INVESTMENT OBJECTIVE
Asset allocation, rather than stock selection, is the key driver of risk and returns and the TPC Model Portfolios are structured accordingly, in line with the Investment Association’s Sector guidelines. Each portfolio is comprised of holdings in the risk progressive ACUMEN Portfolios, which invest in highly diversified baskets of ETFs providing cost effective and tax efficient exposure to global markets. The ACUMEN Portfolios are constructed by Tavistock primarily using
INVESTMENT PHILOSOPHY
On the 30/09/2018 the PBFP Risk Level 5 Portfolio changed its name to the TPC Risk Level 6 Portfolio. The objective and risk parameters of the model portfolio are unchanged.
Industry Leading Risk Management• Comprehensive risk management via a series of in-
house asset class dashboards• Rigorous quantitative analysis using AlternativeSoft
with data from Thomson Reuters Eikon and Lipper for Investment Management
• Relative value technical analysis using Tradesignal
Hedged Currency Exposure• Majority of Overseas portfolio exposure hedged
back to GBP• No unexpected risks within the portfolio• Ensuring portfolio will remain aligned with
specific volatility target
Monitoring of Portfolio• A team of investment professionals will monitor
the portfolio every trading day of the year• Any potential impact of financial markets can be
assessed in real-time• Improvements to portfolios can be identified
quickly
Active Management• Tavistock Private Client can make changes to the
portfolio as required• Enables us to react to markets quickly on your
behalf• Affording you additional protection during times
of market volatility
6.0%
13.0%
7.5%1.5%
1.5%60.5%
9.0%
1.0%
53.5%
11.0%
12.5%
8.5%
7.0%7.5%
70
95
120
145
170
195
70
95
120
145
170
195
Jan-
08
Jun-
08
Nov
-08
Apr-
09
Sep-
09
Feb-
10
Jul-
10
Dec-
10
May
-11
Oct
-11
Mar
-12
Aug-
12
Jan-
13
Jun-
13
Nov
-13
Apr-
14
Sep-
14
Feb-
15
Jul-
15
Dec-
15
May
-16
Oct
-16
Mar
-17
Aug-
17
Jan-
18
Jun-
18
Nov
-18
Apr-
19
Sep-
19
15
TOP 5 HOLDINGS
iShares Edge MSCI World Minimum Volatility
iShares Edge MSCI World Multifactor
iShares Edge MSCI World Quality Factor
iShares US Mortgage Backed Securities
MS SciBeta HFE US Equity 6F EW
TPC Risk Level 6
18th February 2008 - 30th September 2019 TPC Risk Level 6
Annualised Return (%) 5.20Volatility (%) 7.96
Downside Risk (%) 8.63Max Drawdown (%) -17.58
Max Gain (%) 6.59Max Loss (%) -7.49
Negative Periods 34.53Positive Periods 65.47
1 year 3 year 5 year ITD
3.33% 15.12% 30.39% 79.87%
Performance
Date of data: 30th September 2019. Source of data: Tavistock Private Client and Tavistock Wealth Limited, Thomson Reuters and Lipper for Investment Management. The TPC Model Portfolio returns are quoted net of fees. *The Market Composite Benchmark (GBP Hedged) is the Sterling Overnight Index Average (5%),Bloomberg Barclays Global Aggregate Bond GBP Hedged Index (20%) Bloomberg Barclays Global High Yield GBP Hedged Index (2%), MSCI World GBP Hedged (63%) and the MSCI Emerging Market Investable Markets Index (10%).
TPC Risk Level 6IA Mixed Investment 40-85% Shares
Market Composite Benchmark*
TPC Risk Level 7
The TPC Risk Level 7 portfolio is managed to Dynamic Planner’s volatility range of 12.60% to 14.70% and has a blended allocation to the range of ACUMEN Portfolios.
RISK PROFILE
16
ASSET ALLOCATION
Government Bonds
Corporate Bonds
Inflation-Linked Bonds
Emerging Market Bonds
Developed Market Equities
Emerging Market Equities
Commodity Equities
Property Equities
Cash
TPC MODEL PORTFOLIO BENEFITS:
REGION ALLOCATION
North America
United Kingdom
Europe ex UK
Asia ex Japan
Japan
Rest of World
The investment objective of the TPC Risk Level 7 portfolio is to seek to deliver long term capital growth by investing in a range of global financial markets. The portfolio is actively managed and comprised of multi-asset investments. The portfolio is typically comprised of higher risk investments such as equities and commodities but will also contain a few lower and medium risk investments such as cash, bonds and property.
INVESTMENT OBJECTIVE
Asset allocation, rather than stock selection, is the key driver of risk and returns and the TPC Model Portfolios are structured accordingly, in line with the Investment Association’s Sector guidelines. Each portfolio is comprised of holdings in the risk progressive ACUMEN Portfolios, which invest in highly diversified baskets of ETFs providing cost effective and tax efficient exposure to global markets. The ACUMEN Portfolios are constructed by Tavistock primarily using
INVESTMENT PHILOSOPHY
On the 30/09/2018 the PBFP Risk Level 6 Portfolio changed its name to the TPC Risk Level 7 Portfolio. The objective and risk parameters of the model portfolio are unchanged.
Industry Leading Risk Management• Comprehensive risk management via a series of in-
house asset class dashboards• Rigorous quantitative analysis using AlternativeSoft
with data from Thomson Reuters Eikon and Lipper for Investment Management
• Relative value technical analysis using Tradesignal
Hedged Currency Exposure• Majority of Overseas portfolio exposure hedged
back to GBP• No unexpected risks within the portfolio• Ensuring portfolio will remain aligned with
specific volatility target
Monitoring of Portfolio• A team of investment professionals will monitor
the portfolio every trading day of the year• Any potential impact of financial markets can be
assessed in real-time• Improvements to portfolios can be identified
quickly
Active Management• Tavistock Private Client can make changes to the
portfolio as required• Enables us to react to markets quickly on your
behalf• Affording you additional protection during times
of market volatility
6.5%7.5% 2.5%
63.5%
20.0%
50.0%
10.5%
8.5%
15.0%
6.5%
9.5%
50
75
100
125
150
175
200
50
75
100
125
150
175
200
Jan-
08
Jun-
08
Nov
-08
Apr
-09
Sep-
09
Feb-
10
Jul-
10
Dec
-10
May
-11
Oct
-11
Mar
-12
Aug
-12
Jan-
13
Jun-
13
Nov
-13
Apr
-14
Sep-
14
Feb-
15
Jul-
15
Dec
-15
May
-16
Oct
-16
Mar
-17
Aug
-17
Jan-
18
Jun-
18
Nov
-18
Apr
-19
Sep-
19
17
TOP 5 HOLDINGS
iShares Edge MSCI World Minimum Volatility
iShares Edge MSCI World Quality Factor
iShares EM Latin America
iShares S&P 500 Information Technology Sector
MS SciBeta HFE US Equity 6F EW
TPC Risk Level 7
18th February 2008 - 30th September 2019 TPC Risk Level 7
Annualised Return (%) 5.99Volatility (%) 9.50
Downside Risk (%) 10.49Max Drawdown (%) -21.22
Max Gain (%) 6.24Max Loss (%) -8.37
Negative Periods 33.81Positive Periods 66.19
1 year 3 year 5 year ITD
2.53% 19.09% 38.39% 96.15%
Performance
Date of data: 30th September 2019. Source of data: Tavistock Private Client and Tavistock Wealth Limited, Thomson Reuters and Lipper for Investment Management. The TPC Model Portfolio returns are quoted net of fees. *The Market Composite Benchmark (GBP Hedged) is the Sterling Overnight Index Average (5%), Bloomberg Barclays Global Aggregate Bond GBP Hedged Index (10%), MSCI World GBP Hedged (65%) and the MSCI Emerging Market Investable Markets Index (20%).
TPC Risk Level 7IA Flexible Investment
Market Composite Benchmark*
TPC Risk Level 8
The TPC Risk Level 8 portfolio is managed to Dynamic Planner’s volatility range of 14.70% to 16.80% and has a blended allocation to the range of ACUMEN Portfolios.
RISK PROFILE
18
INVESTMENT PHILOSOPHYAsset allocation, rather than stock selection, is the key driver of risk and returns and the TPC Model Portfolios are structured accordingly, in line with the Investment Association’s Sector guidelines. Each portfolio is comprised of holdings in the risk progressive ACUMEN Portfolios, which invest in highly diversified baskets of ETFs providing cost effective and tax efficient exposure to global markets. The ACUMEN Portfolios are constructed by Tavistock primarily using
ASSET ALLOCATION
Government Bonds
Corporate Bonds
Inflation-Linked Bonds
Emerging Market Bonds
Developed Market Equities
Emerging Market Equities
Commodity Equities
Property Equities
Cash
TPC MODEL PORTFOLIO BENEFITS:
REGION ALLOCATION
North America
United Kingdom
Europe ex UK
Asia ex Japan
Japan
Rest of World
The investment objective of the TPC Risk Level 8 portfolio is to seek to deliver long term capital growth by investing in a range of global financial markets. The portfolio is actively managed and comprised of multi-asset investments. The portfolio is typically comprised of higher risk investments such as equities and commodities but will also contain a few medium risk investments such as bonds and property.
INVESTMENT OBJECTIVE
On the 30/09/2018 the PBFP Risk Level 7 Portfolio changed its name to the TPC Risk Level 8 Portfolio. The objective and risk parameters of the model portfolio are unchanged.
Industry Leading Risk Management• Comprehensive risk management via a series of in-
house asset class dashboards• Rigorous quantitative analysis using AlternativeSoft
with data from Thomson Reuters Eikon and Lipper for Investment Management
• Relative value technical analysis using Tradesignal
Hedged Currency Exposure• Majority of Overseas portfolio exposure hedged
back to GBP• No unexpected risks within the portfolio• Ensuring portfolio will remain aligned with
specific volatility target
Monitoring of Portfolio• A team of investment professionals will monitor
the portfolio every trading day of the year• Any potential impact of financial markets can be
assessed in real-time• Improvements to portfolios can be identified
quickly
Active Management• Tavistock Private Client can make changes to the
portfolio as required• Enables us to react to markets quickly on your
behalf• Affording you additional protection during times
of market volatility
6.5%
58.5%
35.0%
31.0%
9.5%15.5%
18.0%
6.0%
20.0%
50
75
100
125
150
175
200
225
50
75
100
125
150
175
200
225
Jan-
08
Jun-
08
Nov
-08
Apr-
09
Sep-
09
Feb-
10
Jul-
10
Dec-
10
May
-11
Oct
-11
Mar
-12
Aug-
12
Jan-
13
Jun-
13
Nov
-13
Apr-
14
Sep-
14
Feb-
15
Jul-
15
Dec-
15
May
-16
Oct
-16
Mar
-17
Aug-
17
Jan-
18
Jun-
18
Nov
-18
Apr-
19
Sep-
19
19
TOP 5 HOLDINGS
iShares Global Water
iShares Mexico Capped
iShares MSCI EM SRI
iShares MSCI India
MS SciBeta HFE US Equity 6F EW
TPC Risk Level 8
18th February 2008 - 30th September 2019 TPC Risk Level 8
Annualised Return (%) 6.23Volatility (%) 10.19
Downside Risk (%) 11.69Max Drawdown (%) -23.12
Max Gain (%) 6.33Max Loss (%) -8.90
Negative Periods 35.25Positive Periods 64.75
1 year 3 year 5 year ITD
2.48% 21.96% 41.51% 101.31%
Performance
Date of data: 30th September 2019. Source of data: Tavistock Private Client and Tavistock Wealth Limited, Thomson Reuters and Lipper for Investment Management. The TPC Model Portfolio returns are quoted net of fees. *The Market Composite Benchmark (GBP Hedged) is the Sterling Overnight Index Average (5%), MSCI World GBP Hedged (65%) MSCI Emerging Market Investable Markets Index (30%).
TPC Risk Level 8IA Flexible Investment
Market Composite Benchmark*
TPC Income
The TPC Income portfolio is managed to Dynamic Planner’s volatility range of 8.40% to 10.50%.
RISK PROFILE
20
ASSET ALLOCATION
Government Bonds
Corporate Bonds
Emerging Market Bonds
Developed Market Equities
Emerging Market Equities
Commodity Equities
Property Equities
Cash
TPC MODEL PORTFOLIO BENEFITS:
On the 30/09/2018 the PBFP Income Portfolio changed its name to the TPC Income portfolio. The objective and risk parameters of the model portfolio are unchanged.
REGION ALLOCATION
North America
United Kingdom
Europe ex UK
Asia ex Japan
Japan
Rest of World
The investment objective of the TPC Income portfolio is to seek to deliver income with the potential for capital growth by investing in a range of global financial markets. The Fund is actively managed and comprised of multi-asset investments. The portfolio is typically comprised of lower and medium risk investments such as cash, bonds and property as well as a few higher risk investments such as equities and commodities.
INVESTMENT OBJECTIVE
Asset allocation, rather than stock selection, is the key driver of risk and returns and the TPC Model Portfolios are structured accordingly, in line with the Investment Association’s Sector guidelines. Each portfolio is comprised of holdings in the risk progressive ACUMEN Portfolios, which invest in highly diversified baskets of ETFs providing cost effective and tax efficient exposure to global markets. The ACUMEN Portfolios are constructed by Tavistock primarily using
INVESTMENT PHILOSOPHY
Industry Leading Risk Management• Comprehensive risk management via a series of in-
house asset class dashboards• Rigorous quantitative analysis using AlternativeSoft
with data from Thomson Reuters Eikon and Lipper for Investment Management
• Relative value technical analysis using Tradesignal
Hedged Currency Exposure• Majority of Overseas portfolio exposure hedged
back to GBP• No unexpected risks within the portfolio• Ensuring portfolio will remain aligned with
specific volatility target
Monitoring of Portfolio• A team of investment professionals will monitor
the portfolio every trading day of the year• Any potential impact of financial markets can be
assessed in real-time• Improvements to portfolios can be identified
quickly
Active Management• Tavistock Private Client can make changes to the
portfolio as required• Enables us to react to markets quickly on your
behalf• Affording you additional protection during times
of market volatility
8.0%
12.0%
21.5%
6.5%
42.0%
4.0%6.0%
53.0%
11.0%
17.5%
4.5% 7.0%7.0%
75
100
125
150
175
200
225
250
75
100
125
150
175
200
225
250
Jan-
09
May
-09
Sep-
09
Jan-
10
May
-10
Sep-
10
Jan-
11
May
-11
Sep-
11
Jan-
12
May
-12
Sep-
12
Jan-
13
May
-13
Sep-
13
Jan-
14
May
-14
Sep-
14
Jan-
15
May
-15
Sep-
15
Jan-
16
May
-16
Sep-
16
Jan-
17
May
-17
Sep-
17
Jan-
18
May
-18
Sep-
18
Jan-
19
May
-19
Sep-
19
21
TPC Income
2nd March 2009 - 30th September 2019 TPC Income
Annualised Return (%) 8.33Volatility (%) 6.23
Downside Risk (%) 6.03Max Drawdown (%) -6.15
Max Gain (%) 6.03Max Loss (%) -3.44
Negative Periods 38.10Positive Periods 61.90
Performance1 year 3 year 5 year ITD
3.79% 10.08% 28.61% 131.59%
TOP 5 HOLDINGS
iShares $ Short Duration High Yield Corp Bond
iShares Euro Dividend
iShares J.P. Morgan EM Local Govt Bond
iShares MSCI USA Quality Dividend
Vanguard FTSE All-World High Dividend Yield
Income Target
3.50% - 4.00%
Rolling 1 Year Income Yield
3.56%
TPC IncomeIA Mixed Investment 20-60% Shares
Market Composite Benchmark*
Date of data: 30th September 2019. Source of data: Tavistock Private Client and Tavistock Wealth Limited, Thomson Reuters and Lipper for Investment Management. The TPC Model Portfolio returns are quoted net of fees. *The Market Composite Benchmark (GBP Hedged) is the Sterling Overnight Index Average (5%), Bloomberg Barclays Global Aggregate Bond GBP Hedged Index (30%), Bloomberg Barclays Global High Yield GBP Hedged Index (10%). MSCI World GBP Hedged (45%) and the MSCI Emerging Market Investable Markets Index (10%).
TPC Equity Growth
The TPC Equity Growth portfolio is managed to Dynamic Planner’s volatility range of 14.70% to 16.80% and has a blended allocation to the range of ACUMEN Portfolios.
RISK PROFILE
22
ASSET ALLOCATION
Government Bonds
Corporate Bonds
Inflation-Linked Bonds
Emerging Market Bonds
Developed Market Equities
Emerging Market Equities
Commodity Equities
Property Equities
Cash
TPC MODEL PORTFOLIO BENEFITS:
On the 30/09/2018 the PBFP Equity Growth portfolio changed its name to the TPC Equity Growth portfolio. The objective and risk parameters of the model portfolio are unchanged.
REGION ALLOCATION
North America
United Kingdom
Europe ex UK
Asia ex Japan
Japan
Rest of World
The investment objective of the TPC Equity Growth portfolio is to seek to deliver long term capital growth by investing in a range of global financial markets. The portfolio is actively managed and comprised of multi-asset investments. The portfolio is typically comprised of higher risk investments such as equities and commodities but will also contain a few medium risk investments such as bonds and property.
INVESTMENT OBJECTIVE
Asset allocation, rather than stock selection, is the key driver of risk and returns and the TPC Model Portfolios are structured accordingly, in line with the Investment Association’s Sector guidelines. Each portfolio is comprised of holdings in the risk progressive ACUMEN Portfolios, which invest in highly diversified baskets of ETFs providing cost effective and tax efficient exposure to global markets. The ACUMEN Portfolios are constructed by Tavistock primarily using
INVESTMENT PHILOSOPHY
Industry Leading Risk Management• Comprehensive risk management via a series of in-
house asset class dashboards• Rigorous quantitative analysis using AlternativeSoft
with data from Thomson Reuters Eikon and Lipper for Investment Management
• Relative value technical analysis using Tradesignal
Hedged Currency Exposure• Majority of Overseas portfolio exposure hedged
back to GBP• No unexpected risks within the portfolio• Ensuring portfolio will remain aligned with
specific volatility target
Monitoring of Portfolio• A team of investment professionals will monitor
the portfolio every trading day of the year• Any potential impact of financial markets can be
assessed in real-time• Improvements to portfolios can be identified
quickly
Active Management• Tavistock Private Client can make changes to the
portfolio as required• Enables us to react to markets quickly on your
behalf• Affording you additional protection during times
of market volatility
6.5%
58.5%
35.0%
31.0%
9.5%15.5%
18.0%
6.0%
20.0%
75
100
125
150
175
200
225
250
275
300
325
350
75
100
125
150
175
200
225
250
275
300
325
350
Jan-
09
May
-09
Sep-
09
Jan-
10
May
-10
Sep-
10
Jan-
11
May
-11
Sep-
11
Jan-
12
May
-12
Sep-
12
Jan-
13
May
-13
Sep-
13
Jan-
14
May
-14
Sep-
14
Jan-
15
May
-15
Sep-
15
Jan-
16
May
-16
Sep-
16
Jan-
17
May
-17
Sep-
17
Jan-
18
May
-18
Sep-
18
Jan-
19
May
-19
Sep-
19
Date of data: 30th September 2019. Source of data: Tavistock Private Client and Tavistock Wealth Limited, Thomson Reuters and Lipper for Investment Management. The TPC Model Portfolio returns are quoted net of fees. *The Market Composite Benchmark (GBP Hedged) is the Sterling Overnight Index Average (5%), MSCI World GBP Hedged (65%) MSCI Emerging Market Investable Markets Index (30%).
23
TOP 5 HOLDINGS
iShares Global Water
iShares Mexico Capped
iShares MSCI EM SRI
iShares MSCI India
MS SciBeta HFE US Equity 6F EW
TPC Equity Growth
2nd March 2009 - 30th September 2019 TPC Equity Growth
Annualised Return (%) 12.17Volatility (%) 10.74
Downside Risk (%) 10.47Max Drawdown (%) -12.04
Max Gain (%) 11.74Max Loss (%) -6.87
Negative Periods 32.54Positive Periods 67.46
Performance1 year 3 year 5 year ITD
2.48% 20.26% 46.92% 234.00%
TPC Equity GrowthIA Flexible Investment
Market Composite Benchmark*
MANAGER COMMENTARY - SEPTEMBER 2019
US manufacturing contracted for the first time in 3 years in August fuelling concerns further weakness may lie ahead. However, the market mood improved noticeably following upbeat employment data, which grew at the fastest rate in 4 months, and ‘non-manufacturing’ data increased well ahead of market expectations. In Asia, Carrie Lam, Hong Kong’s chief executive, withdrew the controversial extradition bill which had sparked pro-democracy protests across the city-state. The significant de-escalation in political risk sparked a rally in the Hang Seng equity index, setting the tone for the month. The bullish mood spread to developed markets where the MSCI World equity index rose 2.18%. In Europe, the region wide Stoxx 600 index rose 3.60%, led by Italy, following an agreement between the anti-establishment Five Star Movement and the centre left Democratic party. Reduced political risk was also good for the country’s bonds. The Italian Treasury took full advantage of the reduced funding costs, selling €7.5 billion of new debt at record levels. It was a different story in the US and Germany, where 10-year government bond yields rose 16bp and 14bp respectively. In the UK, the Battle for Brexit escalated further as the Supreme Court ruled Prime Minister Boris Johnson had misled the Queen by advising her to prorogue parliament. Boris Johnson accepted the ruling but argued it was the wrong outcome for the country. As such it proved a volatile month, for politics and markets, as evidenced by sterling which fluctuated between 1.20 and 1.26 versus the US dollar. In commodity markets, the S&P Goldman Sachs Commodity index rose 1.75%, led higher by the agricultural sub-sector which rose 5.25%. Brent crude rose 0.58% to $60.78 a barrel and gold fell -3.15% to $1,472 per ounce.
CHARGES
24
TAVISTOCK PROFILE CHARGES
PORTFOLIO AMC
TAVISTOCK PROFILE CHARGES
PORTFOLIO
1.03%
1.09%
1.12%
1.13%
1.10%
1.17%
1.14%
1.17%
OCF TOTAL TRANSACTIONAL COSTS
ESTIMATED TOTAL COSTS
0.06%
0.08%
0.02%
0.04%
-0.02%
0.02%
0.15%
0.02%
1.09%
1.17%
1.14%
1.17%
1.08%
1.19%
1.29%
1.19%
TPC MODEL PORTFOLIO CHARGES
TPC Risk Level 3
TPC Risk Level 4
TPC Risk Level 5
TPC Risk Level 6
TPC Risk Level 7
TPC Risk Level 8
TPC Income
TPC Equity Growth
GLOSSARY OF TERMS
Downside RiskDownside risk is a measurement which only looks at negative returns. It represents an estimation of the potential loss in negative market conditions. It could be considered as an estimate of the potential loss on any investment.
Max DrawdownRepresents the worst possible return since inception. E.g. Buying at the maximum price over the period and selling at the worst.
Max GainRepresents the best running return since inception. E.g. The longest running consecutive gain with-out making a loss.
Max LossRepresents the worst running return over the since inception. E.g. The longest running consecutive loss without making a gain.
Negative PeriodsIndicates percentage number of negative weekly returns.
Positive PeriodsIndicates percentage number of positive weekly returns.
Annualised ReturnThe annualised return of the instrument since inception.
VolatilityStandard deviation is a statistical measurement which, when applied to an investment fund, express-es its volatility, or risk. It shows how widely a range of returns varied from the fund’s average return over a particular period. Low volatility reduces the risk of buying into an investment in the upper range of its cycle, then seeing its value fall towards the lower extreme. For example, if a fund had an average return of 5%, and its volatility was 15, this would mean that the range of its returns over the period had swung between +20% and -10%. Another fund with the same average return and 5% vol-atility would return between 10% and nothing. While volatility is specific to a fund’s particular mix of investments, and comparison to other portfolios is difficult, clearly, for those that offer similar returns, the lower-volatility funds are preferable. There is no point in taking on higher risk than necessary in order to achieve the same reward.
Market Composite BenchmarkAn index based on pre-determined weights, composed of equities, bonds or any combination of asset classes, whose value is measured and used for comparative performance purposes against the TPC Model Portfolios.
25
The value of investments held in the TPC Model Portfolios may fall as well as rise. Past performance should not be seen as an indication of future performance.
Tavistock Private Client Limited and Tavistock Wealth Limited are authorised and regulated by the Financial Conduct Authority. Tavistock Private Client Limited and Tavistock Wealth Limited are wholly
owned subsidiaries of Tavistock Investments Plc.
Tavistock Private Client, Tennyson House, Cambridge Business Park, Cambridge , CB4 0WZ www.tavistockprivateclient.com - [email protected]
THIS DOCUMENT IS ISSUED BY TAVISTOCK WEALTH LIMITED AND IS FOR USE BY FINANCIAL ADVISERS ONLY. IT SHOULD NOT BE RELIED UPON BY A RETAIL CLIENT. This document does not constitute an offer to subscribe or invest in the TPC Model Portfolios nor buy or sell shares in the ACUMEN Portfolios. The ACUMEN Portfolios are sub-funds of the ACUMEN OEIC. The Prospectus is the only authorised document for offering shares in the ACUMEN Portfolios and investors are required to read the Key Investor Information Document (KIID) before investing. Documentation is available free of charge at www.ifslfunds.com or by calling 0845 1231084. Tavistock Wealth Limited does not provide investment advice. This document may not be reproduced, disclosed or distributed without the prior written permission of Tavistock Wealth Limited. iShares® and BlackRock® are registered trademarks of BlackRock, Inc. and its affiliates (“BlackRock”) and are used under license. Further, BlackRock, Inc. and its affiliates including, but not limited to, BlackRock Investment Management (UK) Limited, are not affiliated with Tavistock Wealth Limited and its affiliates. Accordingly, BlackRock makes no representations or warranties regarding the advisability of investing in any product or service offered by Tavistock Wealth Limited or any of its affiliates. BlackRock has no obligation or liability in connection with the operation, marketing, trading or sale of any product or service offered by Tavistock Wealth Limited or any of its affiliates. The Market Composite Benchmark was amended on the 30th September 2019, data is therefore live from this date. Data prior to this date is the historical Market Composite Benchmark information which is available upon request or can be sourced via previous versions of this document. The Rolling 1 year dividend yield as of the valuation point of the underlyingholdings on 30/09/19 (applicable to income share class only). The yield incorporates the NAV as of the valuation point date. Source of data: Tavistock Private Client, Tavistock Wealth Limited, Thomson Reuters and Lipper for Investment Management unless otherwise stated. All performance data up until 31/12/16 has been provided by Tavistock Private Client. As of 01/01/17, all TPC Model Portfolios invest in a blend of the ACUMEN Portfolio range. All performance data thereafter is provided by Tavistock Wealth Limited. Date of data: 30th September 2019 unless otherwise stated.
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