Wealthify Performance - September 2020

A month in the markets
Reading time: 5 mins

September 2020 saw mixed performance across all major stock marketfollowing concerns of second wave of covid-19. While data continues to point to a recovery in economic growththere remains a stark difference between countries and across regions. One example of this is fiscal support, which has been announced in the UK and Europe, aimed at supporting jobsThis support has helped, although unemployment in the UK and Eurozone has still increased slightly. However, in the US, the political divide has been exacerbated by the nearing election, causing a delay in further government spending.  

Data released in September showed that the manufacturing sector has continued to expand, while the service sector has slowed. Globally, consumer spending has been lifted, largely by the spending of savings built up due to lockdown restrictions. And while consumer confidence has continued to recover, the outlook remains uncertain.  

Beyond covidBrexit negotiators have agreed to continue talks, but little else has progressedWere also in the final countdown to the US election in November, and you can read about how we view potential outcomes in our blog post, a quick guide to the 2020 US election 

Markets 
In September, global stock markets were a mixed bagConcerns around high valuations weighed on US tech stockswhich coupled with worries around the second wave of covid-19, saw many major markets fall. Shares in the US (-3.80%), Europe (-2.30%), Asia Pacific excluding Japan (-2.30%)and Emerging Markets (-1.62%) all ended the month in negative territory. However, Japanese equites (+0.67%) and the UK’s FTSE-100 (+0.17%) both improved. 

Currency 
An improvement in investors risk appetite has managed to offset much of the concern surrounding the ongoing Brexit talks. As a result, September saw the British pound decline against the three major currencies. It fell the least against the euro (-1.62%), dropping more against the US dollar (-3.48%) and the Japanese yen (-3.90%).  

Investment type performance breakdown 
Throughout September, the resurgence of covid-19 cases in Europe weighed on propertyHowever, this rise in concern supported the value of bonds, which meant that within our investment types bonds (+0.33%) and shares (+0.29%) rose, while property (-0.72%) fell. 

Summary with Plan details 
The September performance of Wealthify Plans was positivewith little difference across the risk levels. Our Investment Team continues to actively monitor the financial markets and their impact on your Plan, and as always, we are ready to act in your best interests to events as they unfold. 

The figures shown are based on a medium-risk (Confident) investment Plan. 

Please remember the value of your investments can go down as well as up, and you could get back less than invested. Past performance is not a reliable indicator of future returns

 

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