AllenbridgeEpic Investment Advisers London Borough of Hounslow Annual General Meeting Performance of the Fund and Activity 10 th November 2014 AllenbridgeEpic Investment Advisers Limited is an appointed representative of Allenbridge Capital Limited which is Authorised and Regulated by the Financial Conduct Authority 1 AllenbridgeEpic Investment Advisers Limited is a subsidiary of Allenbridge Investment Solutions LLP
Value of your pension assets over time Source: WM 2
Your pension assets – 31 st March 2014 Total Fund £719.8 million Source: WM 3
Key performance achievements in the past year The fund delivered a reasonable return of +4.8% for the financial year to March 2014 It grew in value by £47 million between March 2013 and March 2014 The portfolio return of +7.9% for the three years to March 2014 was +0.4% ahead of the fund’s benchmark The fund was also ahead of the three ‐ year average WM local authority return of +7.5% 4
UK equities Both Aberdeen and BlackRock manage a portfolio of UK equities Objective: do better than the FTSE All Share Index, which measures the performance of over 700 UK companies Assessment: over a long period, usually 3 years Both managers have done well but Source: WM report to 31/3/14, all performance is gross of manager fees Aberdeen is slightly ahead of BlackRock 5
Overseas equities Both Aberdeen and BlackRock manage a portfolio of overseas equities Aberdeen only holds non ‐ UK stocks, BlackRock holds UK and overseas Both managers have done well But the the past twelve months have been challenging for both of Source: WM report to 31/3/14, all performance is gross of manager fees them 6
Bonds Both Aberdeen and BlackRock manage a portfolio of bonds This contain a mix of inflation ‐ linked and fixed coupon bonds Their portfolios include government bonds and corporate bonds Over the past three years, bonds have done just as well as equities Source: WM report to 31/3/14, all performance is gross of manager fees But both managers are trailing the index 7
Property Now investing in two external pooled funds Property also had good absolute returns over three years Internally managed portfolio was performing less well – affecting three ‐ year numbers Source: WM report to 31/3/14 8
Private equity (diversifying assets) A portfolio of private equity funds monitored by officers Diversifies the equity risk Has performed extremely well over the past three years Change in strategy in 2013/14 – moving to funds with a wider range of assets (not just private equity) Source: WM report to 31/3/14, all performance is net of manager fees 9
The New Investments in the Fund 10
Diversified growth funds Invest in a wide range of assets that perform differently to UK equities They provide protection against falling equity markets But over time they should deliver good absolute returns They also have lower volatility than equities 11
Property funds Two new investments in property funds managed by Threadneedle and CBRE Threadneedle invest in Grade B properties (e.g. properties just outside the ‘prime location’ category) CBRE invest in a range of core assets. Theirs is a more cautious approach Timing of new investments ‐ beneficial. One year return for the IPD Index to March 2014 was +11.0% Threadneedle took London Borough of Hounslow’s existing direct holdings in return for units in their Fund ‐ market values agreed by an independent valuer 12
Is the fund achieving its objectives? The fund has coped well despite continued challenges in markets The external managers have performed well over three years although the past year has been challenging The new diversifying assets portfolio is performing well and doing its job Property has had a very strong 12 months and this has helped the Fund The Committee is currently looking carefully at the bond allocation to see if there is a more efficient way to capture the opportunities in this sector 13
Important information This document is directed only at the person(s) identified on the first slide on the basis that they are a professional investor or professional customer. It is issued by AllenbridgeEpic Investment Advisers Limited, an appointed representative of Allenbridge Capital Limited which is Authorised and Regulated by the Financial Conduct Authority. No liability is admitted to any other user of this report and if you are not the named recipient you should not seek to rely upon it. Information about securities contained in this report is provided for information purposes only. Nothing contained herein should be construed as a recommendation or solicitation to buy or sell any security. 14
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