SUMMER 2021 - IS THE INFLATION GENIE out of the bottle?
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SUMMER 2021 IS THE INFLATION GENIE out of the bottle? Will better-than-expected growth spark runaway inflation in 2021? IMPROVING PROSPECTS for Japan Signs of life have emerged as Japan’s main stock market, the Nikkei, breached 30,000 for the first time in three decades TIME IN THE MARKET, not timing the market Staying the course when investing is a simple lesson to understand but, for many, the hardest to apply
LIONTRUST
CONTENTS
Is the inflation genie out
4–5
of the bottle?
Views of the Liontrust
6–7
Multi-Asset team
Improving prospects for Japan 8–9
Time in the market,
10–11
not timing the market
Facts and figures 12–23
2
views
Welcome
to LIONTRUST views – Summer 2021
Welcome to the Summer edition of Liontrust Views.
4
Inflation matters to all of us. Most obviously, this is because
it makes the prices we pay for goods and services more
IS THE
expensive. Unless our income rises at least in line with the rate INFLATION
of inflation, we will become poorer in real terms.
GENIE out
Governments and central banks have historically tried to of the bottle?
contain and then reduce inflationary pressures by raising
interest rates. This makes debt more expensive and will impact
the performance of stock market listed companies. Usually,
growth stocks are most negatively affected as they are priced
more on the value of future earnings and these are reduced by
interest rates going up.
Our article on pages 4 and 5 examines the prospects for
higher inflation, how persistent might it be and how might
8 IMPROVING PROSPECTS
governments and central banks react. The article also discusses
why stock markets worry about inflation.
for Japan
Equally, deflation can be damaging for economic growth and
stock market performance. One country that knows this better
than most is Japan and has been shunned by many investors as
a result. On pages 8 and 9, we analyse whether Japan could
be one of the winners from the global economic recovery.
We look back at the forces driving stock markets over the past
quarter and provide our latest investment views on pages 6 to 7.
TIME IN THE MARKET,
10
One theme we have seen develop is a greater number of sharp
movements in stock markets, both up and down. These can be
painful for investors if monitored on a daily basis. But our article not timing the market
on pages 10 and 11 provides analysis on the benefits of
remaining invested over the long term and navigating through
any such volatility.
We hope you find this issue of Liontrust Views insightful and
interesting.
3
LIONTRUST
IS THE INFLATION
GENIE OUT OF
THE BOTTLE?
4
views
Just as Brexit and trade wars dominated sentiment in 2018/19 and
Covid took the reins last year, the macro story of 2021 so far, beyond
vaccination efforts, has been whether better-than-expected growth as the
world reopens might spark runaway inflation and how that could affect
John Husselbee
recovery from the pandemic. This has meant a growing focus on central
banks, with their every word analysed for any signs of a shift in policy.
Inflation in the US has already crept above 5% year on year while for the future, with Fed chair Jerome Powell saying the economy is
in the UK, the level has exceeded the Bank of England’s 2% target not yet at the point where slowing asset purchases is appropriate.
for the first time in almost two years. Despite this, the US Federal
Reserve and other policymakers insist this spike will be temporary, It is increasingly clear policymakers are walking a tightrope,
citing the effect of pent-up demand being released as economies working out the point at which inflation changes from a side
reopen and the fact most of the price pressure is in fast-recovering effect of growth to a challenge to it.
areas hit hardest by Covid, such as air travel.
While the factors cited by central banks (liquidity, base effects
While higher and more volatile prices in the long term is a concern, of higher energy prices and pent-up consumer demand) have
the more immediate worry is what central banks, despite efforts to created the current spike in inflation, we do not see conditions
calm markets, might be forced to do if inflation continues to move forming, for now, that pave the way towards persistent higher
upwards. Interest rate rises, for example, have been the classic prices over the longer term. Wage inflation has traditionally been
way of curbing inflation but most countries have been able to keep key to higher overall levels, but the forces of globalisation and
rates low to aid recovery from the pandemic and for much of the technology have kept this down in recent years and we believe
last decade. Until recently the perception was that rate rises were any meaningful pick-up is unlikely over the medium to long term.
unlikely until 2024 at the earliest and anything before that, even if
still well into the future, would have an impact on sentiment. The Liontrust Multi-Asset investment team added to our exposure to
index-linked bonds last year, for which the income paid rises in line
Another part of the picture is central banks’ asset purchasing, known with inflation. While not predicting persistently higher prices, we felt
as quantitative easing (QE), where they support the economy by that, given the fact central banks are prepared to accept some inflation
buying debt and flooding markets with liquidity. Stronger-than- as part of the recovery from Covid-19, higher index-linked exposure is
expected growth in the US and the UK has increased concerns a sensible holding. We were also able to access it at more attractive
about when this support may be withdrawn, or tapered, which levels than today, where elevated inflation is reflected in prices; as
could also spook investors and cause stock markets to fall. ever, we want to prepare for eventualities rather than react to them.
With the caveat that things are changing daily, what can we say We would also press the case for real assets, defined as tangible
about the current state of play? At its June meeting, the US Federal assets such as buildings, toll roads, solar or wind farms or
Reserve announced higher expectations for inflation for 2021 and commodities such as energy, livestock or grains, which derive
two potential rate rises in 2023. Even with the raised forecast for value from their availability and usability by consumers and
this year, however, the Fed sees inflation moving down to its 2% businesses. These have proved an effective hedge against rising
goal over the long run and continues to claim it has the tools to stop prices over a market cycle, with much of the revenue generated
things running too hot. For now, ending QE remains a discussion structured as long-term inflation-linked contracts.
Why stock markets worry about high inflation
• Higher inflation means rising input costs (the cost of creating government and corporate debt, which was
a product or a service), which companies may not be able to increased to get through the pandemic.
offset through passing on higher prices to customers.
• Inflation can be particularly damaging for
• Higher inflation could pressure the US Federal Reserve and growth stocks in sectors like technology
other central banks to scale back loose monetary and fiscal as they rely more on the value of future
policies sooner than expected, which have been a major earnings, which is reduced if interest rates
contributor to ongoing all-time highs in stock markets. are raised to contain the rate of inflation. This
would be more detrimental to markets such as
• Higher inflation pushes bond yields up, which means higher the US, where technology has been key to
borrowing costs. This is a clear issue given high levels of overall returns over recent years.
5
LIONTRUST
OVERALL
• We continue to be positive about markets overall due to especially in Asia, are falling behind in their vaccine rollouts.
central bank support, vaccine distribution and pent-up The emergence of new virus mutations also remains a concern.
corporate and consumer demand being released.
• While central banks such as the US Federal Reserve have
• But there are challenges to this view, from growth disappointments started to discuss reducing levels of support for the economy,
to ongoing pandemic risks. While overall recovery continues, we see no serious prospect of this turning into reality in the
the picture is becoming more nuanced as some countries, short to medium term.
EQUITIES
• This positive ‘risk on’ environment continues to favour equities. • Since the positive vaccine news emerged late last year,
there has been a far broader rally in stock markets amid an
• Stock market recoveries since the 2020 lows are largely ongoing global rebound, and this has seen more cyclical
justified by government spending and corporate results. We and value companies catching up with the growth names that
remain positive on valuations outside of US mega caps, dominated for most of 2020.
favouring cheaper regions such as Europe, Japan, emerging
markets and the UK. • Bond yields are also starting to rise after a long period
of decline and the general perception is that this tends to
• Our long-standing concerns about stretched valuations in the penalise growth stocks.
US remain, especially at the more speculative technology
end, but 2021 earnings have surprised positively and even • We are optimistic about smaller companies, with improving
this market is starting to offer better value. economic activity thanks to the vaccine rollout providing
ongoing impetus for these largely domestic-orientated names
which tend to lead the way during periods of recovery.
6
views
BONDS
• We remain broadly negative on bonds but always maintain • At present, given challenging conditions for bonds overall, we
some exposure as zero weighting any asset class negates the favour higher-risk areas such as high yield and emerging market
long-term benefits of diversification. debt, and recently increased exposure to index-linked bonds.
• Bonds continue to meet four roles: providing some income,
capital preservation, inflation protection and diversification
from equities.
CHANGES
• As part of our latest target tactical allocation review, we • We remain cautious about the US but the stock market is
pared back our exposure to Japanese equities slightly, moved offering better value after the recent cooling off. The key
more positive on UK smaller companies and neutral on the question remains whether the US stock market is prone to
US, and are slightly more constructive on UK gilts and global a deeper correction after the great acceleration of the last
government bonds. year and we would suggest a shift towards ‘real world’ rather
than virtual interaction will put further pressure on technology
• Japan is still among our favoured cheaper equity markets and revenues and therefore potentially the tech mega caps.
we feel the country is well positioned amid the ongoing global
recovery. Our concern is about the country’s slow progress on • Finally, prospects have improved slightly for gilts and global
Covid vaccinations, which could impact the domestic recovery. government bonds. While still towards the more negative end
of our tactical asset allocation scale, this reflects yields moving
• We are positive about UK small companies, with predictions upwards on the back of inflation concerns and looking slightly
that the economy will grow at the fastest rate since the Second more attractive.
World War over the rest of 2021.
7
Jap
LIONTRUST
I
M
P F
R O
P
O R
R
V O
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N P
G E
C
T
S
Japan has dropped off many investment radars
over recent years, with detractors falling back
on traditional concerns about poor corporate
governance and deflation – when prices
for goods and services fall – but there are
indications this aversion is starting to turn.
8
pan.
views
Signs of life have emerged as Japan’s main stock market, the ‘Abenomics’ programme have been effective in pulling Japan
Nikkei, breached 30,000 for the first time in three decades in out of its long slump, stretching back to the 1990s. In fact, the
February, and the country was among the world’s most resilient situation had changed to such an extent that Bank of Japan (BoJ)
economies in 2020. Japan is also in the spotlight as Tokyo hosts Governor Haruhiko Kuroda declared ‘victory’ in July 2019,
the delayed 2020 Olympic Games despite slow progress on claiming that for the first time in 15 years the economy was no
vaccinations and therefore no paying spectators. longer in deflation. Covid-19 has turned things on their head,
however, and hit spending on services, which makes up around
Japan has a large proportion of cyclical and value businesses a third of total consumption in Japan. While deflation is not
and its broad exposure to industrials and exporters means expected to return, Kuroda has acknowledged the need for
the country is well placed amid the current global economic vigilance on prices.
rebound. Corporate debt is also low and companies, on the
whole, are managed sensibly and conservatively. The long-term There are also growing fears that Japan’s progress could
criticism has been that they are also run without much diversity, be derailed as the country tries to contain its latest wave of
transparency or for the benefit of external shareholders. Coronavirus and speed up vaccinations. It is difficult to know
what impact this might have but it seems sensible to suggest that
A practice known as cross-shareholding has traditionally been while the country is set to benefit from a global rebound, its own
seen as the worst example of poor transparency, where Japanese domestic recovery could be impacted.
companies invest in each other and protect underperforming
management teams via a cushion of automatic shareholder With Japan’s stock market back at levels last seen in 1990
support. Critics suggest this has fostered complacency, low and long-term threats of deflation and cross-shareholdings
returns and poor governance, but changes to the corporate moving towards the past tense, we continue to see reasons to
code and new listing rules on the Tokyo Stock Exchange suggest be positive about a cheap stock market with a cyclical bias. As
the practice could be edging closer to extinction. events in India have shown, however, no one can afford to be
complacent and we are keen to see the vaccination programme
To deal with the other ‘mired in deflation’ criticism, structural accelerate, especially with the eyes of the world on the country
changes ushered in by former prime minister Shinzo Abe’s during the Olympic festivities.
9
LIONTRUST TIME IN THE MARKET, not timing the market 10
views
Most investors will have heard the phrase ‘time in the market, not timing the market’
over the years and logged it as another financial cliche. And yet this phrase embodies
perhaps the most fundamental lesson of successful investing: patient accumulation of
returns, year after year, delivers long-term results.
Staying the course when investing is a simple lesson to understand Investing will always involve market dips and volatility from time
but, for many, the hardest to apply when faced with the reality to time but history shows these events have little impact on long-
of rising and falling markets. We saw an extreme example of term performance.
volatility when the full ramifications of the pandemic became
clear last year, with a huge dip in March/April followed by a Consider the following figures on the impact of reacting to short-
swift recovery. Those who stayed invested quickly saw paper term noise: missing the best 50 days in markets over 11 years
losses evaporate but many that panicked into selling will have from March 2009 to February 2020, just 1% of trading days,
seen substantial damage to portfolios – potentially exacerbated would have reduced the return from £100,000 invested in an
by not getting back into markets fast enough to capture the average Cautious Managed fund from just over £218,700 to
rapid recovery. just under £130,000 – which equates to 75% lower returns.
£100,000 invested in a Cautious Managed Portfolio in March 2009
£250,000
£218,766
£200,000 £185,368
£163,188
£149,169
£150,000 £138,779
£129,998
£100,000
£50,000
£0
Fully invested Missing 10 best days Missing 20 best days Missing 30 best days Missing 40 best days Missing 50 best days
Source: Liontrust, Morningstar. Cautious Managed Portfolio represented by IA Mixed Investment 20-60% Shares sector average £ total returns from 8th
March 2009 to 20th February 2020.
One of our favourite pieces of data shows that over rolling Looking over history, there are lessons to take from recoveries,
three-month periods in the last 25 years, the FTSE 100 has which also apply to 2020. Bear markets typically have been
been down 30% of the time and up 70%; if you extend this relatively short compared with recoveries and have had a
period to rolling 10-years, the ratio shifts to 98% positive modest impact on returns compared with the long-term power
periods. Making decisions based on short-term data rarely of bull markets. According to figures from Capital Group, the
produces good results. average bear market going back to 1950 has lasted 14 months
with a return of around -30% while the average bull period has
We believe in what we call noise-cancelling investment: staying lasted five times longer, with total returns of close to 280%.
the course in a well-diversified portfolio and ignoring market
fluctuations as far as possible. Where investors have been These stats clearly show the benefits of staying the course and
unable to do this, however, it is typically better to be too early not being panicked into selling but are also a stark example
into markets than too late, particularly when it comes to of why too early beats too late, especially when it comes to
recoveries from bear markets. It is better to be market recoveries.
sitting on a train for a few minutes before
it departs than trying to chase it down
as it pulls out of the station.
11LIONTRUST 12
views
Facts & Figures
QUARTERLY DATA
European (but not Emerging market Asian (but not Emerging market
US stocks UK stocks
UK) stocks stocks Japanese) stocks bonds
8.41% 8.29% 5.60% 4.99% 4.66% 3.80%
S&P 500 FTSE All World FTSE All-Share Index MSCI Emerging MSCI Pacific JP Morgan Global
Composite Index Developed Europe Market Index excluding Japan Emerging Market
excluding UK Index Index Bond Index
US corporate Global high yield UK corporate European Global
Japanese stocks
bonds bonds bonds corporate bonds government bonds
-1.10%
TOPIX Index
3.42% 2.43% 1.74% 1.07% 0.91%
Bloomberg Barclays ICE Bank of Bloomberg Barclays Bloomberg Barclays FTSE G7 Index
US Corporate America ML Global Sterling Aggregate European Corporate
Bond Index High Yield Bond Bond Index Bond Index
Index
To highlight the unpredictability of markets, the table below details This table demonstrates how volatile markets can be, and shows
the performance of global equity and fixed income indices over the benefits of diversifying your investment, or in other words, not
the past five years (in sterling terms). putting all your eggs in one basket.
1 Jul 2020 to 1 Jul 2019 to 1 Jul 2018 to 1 Jul 2017 to 1 Jul 2016 to
Index percentage growth (%) 30 Jun 2021 30 Jun 2020 30 Jun 2019 30 Jun 2018 30 Jun 2017
US stocks 25.93 10.73 14.54 12.53 21.33
European (but not UK) stocks 22.99 0.70 8.00 2.92 28.95
UK stocks 21.45 -12.99 0.57 9.02 18.12
Japanese stocks 8.40 3.37 -4.43 7.17 21.58
Asian (but not Japanese) stocks 20.14 -10.02 12.23 7.06 23.07
Emerging market stocks 26.43 -0.14 5.40 6.84 27.79
Global government bonds -10.66 8.60 9.53 -0.06 -2.29
Global high yield bonds 3.39 2.40 11.54 0.45 15.68
US corporate bonds -7.60 12.79 14.85 -2.43 5.26
European corporate bonds -2.15 1.16 6.01 1.85 6.98
Emerging market bonds -4.46 4.57 15.48 -4.02 8.60
UK corporate bonds -4.24 10.17 5.43 1.61 0.75
Past performance is not a guide to future performance. Rebased in sterling where appropriate, i.e. all index returns are recalculated
based on exchange rates to give returns for a sterling investor. Source: Morningstar Direct, 7 July 2021.
13LIONTRUST
Active fund range
THE LIONTRUST MULTI-ASSET INVESTMENT TEAM
John James Paul Kim Mayank Jen Causton Shayan
Husselbee Klempster Markanday Ratnasingam
PORTFOLIO CHANGES
BOUGHT SOLD
• n/a • Real Estate Credit Investments
• JPMorgan Sterling
Liquidity Fund
14views
CUMULATIVE RETURN
3 MONTHS 1 YEAR 3 YEARS 5 YEARS
Fund and share class 31 Mar 21 to 30 Jun 20 to 30 Jun 18 to 30 Jun 16 to
Total returns for the periods shown (%) 30 Jun 21 30 Jun 21 30 Jun 21 30 Jun 21
Liontrust MA Active Reserve S Acc 2.77 0.68 7.69 12.89
Liontrust MA Active Moderate Income S Acc 3.43 6.40 14.59 25.95
Liontrust MA Active Intermediate Income S Acc 4.52 13.86 20.93 40.45
Liontrust MA Active Progressive S Acc 5.33 18.87 23.23 55.14
Liontrust MA Active Growth S Acc 5.80 24.75 27.12 69.42
Liontrust MA Active Dynamic S Acc 6.13 26.46 32.64 74.74
DISCRETE YEARLY PERFORMANCE
Fund and share class 30 Jun 20 to 30 Jun 19 to 30 Jun 18 to 30 Jun 17 to 30 Jun 16 to
Total returns for the periods shown (%) 30 Jun 21 30 Jun 20 30 Jun 19 30 Jun 18 30 Jun 17
Liontrust MA Active Reserve S Acc 0.68 3.82 3.02 -0.58 5.45
Liontrust MA Active Moderate Income S Acc 6.40 3.90 3.66 -0.14 10.07
Liontrust MA Active Intermediate Income S Acc 13.86 2.01 4.11 1.83 14.06
Liontrust MA Active Progressive S Acc 18.87 0.07 3.60 5.87 18.92
Liontrust MA Active Growth S Acc 24.75 -1.40 3.34 7.39 24.10
Liontrust MA Active Dynamic S Acc 26.46 1.49 3.35 4.84 25.66
Source: Financial Express, as at 30 June 2021. Total return figures are calculated on a single pricing basis. Performance figures are
shown in sterling unless otherwise specified. The fund performance figures are net of all fees.
ASSET ALLOCATION FUND SELECTION
WHAT WORKED? WHAT DIDN’T? WHAT WORKED? WHAT DIDN’T?
• UK Property • Government bonds • Tritax Big Box • iShares MSCI UK
• High Yield • BlackRock European Small Cap
• Europe ex-UK equities Dynamic • BlackRock Asia
• LF Lindsell Train UK Equity Special Situations
• US equities
• AB American Growth
Past performance is not a guide to future performance. Do remember that the value of an investment and the income generated
from them can fall as well as rise and is not guaranteed, therefore, you may not get back the amount originally invested and
potentially risk total loss of capital. Please refer to page 24 for more information on the Key Risks.
15LIONTRUST
Blended fund range
THE LIONTRUST MULTI-ASSET INVESTMENT TEAM
John James Paul Kim Mayank Jen Causton Shayan
Husselbee Klempster Markanday Ratnasingam
PORTFOLIO CHANGES
BOUGHT SOLD
• n/a • Real Estate Credit Investments
16views
CUMULATIVE RETURN
3 MONTHS 1 YEAR 3 YEARS 5 YEARS
Fund and share class 31 Mar 21 to 30 Jun 20 to 30 Jun 18 to 30 Jun 16 to
Total returns for the periods shown (%) 30 Jun 21 30 Jun 21 30 Jun 21 30 Jun 21
Liontrust MA Blended Reserve S Acc 3.18 4.48 10.68 23.49
Liontrust MA Blended Moderate S Acc 3.92 8.87 15.00 33.64
Liontrust MA Blended Intermediate S Acc 4.25 13.32 17.76 41.62
Liontrust MA Blended Progressive S Acc 4.75 17.47 19.83 51.95
Liontrust MA Blended Growth S Acc 5.28 23.43 25.01 62.87
DISCRETE YEARLY PERFORMANCE
Fund and share class 30 Jun 20 to 30 Jun 19 to 30 Jun 18 to 30 Jun 17 to 30 Jun 16 to
Total returns for the periods shown (%) 30 Jun 21 30 Jun 20 30 Jun 19 30 Jun 18 30 Jun 17
Liontrust MA Blended Reserve S Acc 4.48 2.76 3.09 2.77 8.57
Liontrust MA Blended Moderate S Acc 8.87 1.88 3.68 3.17 12.64
Liontrust MA Blended Intermediate S Acc 13.32 0.21 3.70 4.56 15.02
Liontrust MA Blended Progressive S Acc 17.47 -1.47 3.52 6.26 19.33
Liontrust MA Blended Growth S Acc 23.43 -2.47 3.84 6.76 22.04
Source: Financial Express, as at 30 June 2021. Total return figures are calculated on a single pricing basis. Performance figures are
shown in sterling unless otherwise specified. The fund performance figures are net of all fees.
ASSET ALLOCATION FUND SELECTION
WHAT WORKED? WHAT DIDN’T? WHAT WORKED? WHAT DIDN’T?
• UK Property • Global Government • JO Hambro UK Equity • n/a
• UK equities bonds Income
• US equities • AB American Growth
• LF Majedie UK Equity
• Ossiam Shiller Barclays
Cape US Value
Past performance is not a guide to future performance. Do remember that the value of an investment and the income generated
from them can fall as well as rise and is not guaranteed, therefore, you may not get back the amount originally invested and
potentially risk total loss of capital. Please refer to page 24 for more information on the Key Risks.
17LIONTRUST
Passive fund range
THE LIONTRUST MULTI-ASSET INVESTMENT TEAM
John James Paul Kim Mayank Jen Causton Shayan
Husselbee Klempster Markanday Ratnasingam
PORTFOLIO CHANGES
BOUGHT SOLD
• BlackRock Corporate Bond • n/a
• Vanguard UK Investment
Grade Bond
• Vanguard Pacific Ex-Japan
• Vanguard Emerging Markets
18views
CUMULATIVE RETURN
3 MONTHS 1 YEAR 3 YEARS 5 YEARS
Fund and share class 31 Mar 21 to 30 Jun 20 to 30 Jun 18 to 30 Jun 16 to
Total returns for the periods shown (%) 30 Jun 21 30 Jun 21 30 Jun 21 30 Jun 21
Liontrust MA Passive Reserve S Acc 2.96 4.09 15.55 30.38
Liontrust MA Passive Moderate S Acc 3.31 7.15 17.04 36.53
Liontrust MA Passive Intermediate S Acc 3.68 10.84 18.91 44.34
Liontrust MA Passive Progressive S Acc 4.27 15.21 21.22 54.85
Liontrust MA Passive Growth S Acc 5.07 20.96 25.62 67.77
Liontrust MA Passive Dynamic S Acc 5.85 23.70 31.22 74.92
DISCRETE YEARLY PERFORMANCE
Fund and share class 30 Jun 20 to 30 Jun 19 to 30 Jun 18 to 30 Jun 17 to 30 Jun 16 to
Total returns for the periods shown (%) 30 Jun 21 30 Jun 20 30 Jun 19 30 Jun 18 30 Jun 17
Liontrust MA Passive Reserve S Acc 4.09 5.51 5.22 4.15 8.34
Liontrust MA Passive Moderate S Acc 7.15 3.43 5.61 4.53 11.60
Liontrust MA Passive Intermediate S Acc 10.84 1.98 5.20 5.95 14.56
Liontrust MA Passive Progressive S Acc 15.21 -0.25 5.48 7.75 18.55
Liontrust MA Passive Growth S Acc 20.96 -2.11 6.09 8.64 22.95
Liontrust MA Passive Dynamic S Acc 23.70 -0.44 6.55 7.54 23.95
Source: Financial Express, as at 30 June 2021. Total return figures are calculated on a single pricing basis. Performance figures are
shown in sterling unless otherwise specified. The fund performance figures are net of all fees.
Past performance is not a guide to future performance. Do remember that the value of an investment and the income generated
from them can fall as well as rise and is not guaranteed, therefore, you may not get back the amount originally invested and
potentially risk total loss of capital. Please refer to page 24 for more information on the Key Risks.
19LIONTRUST
Income generating fund range
THE LIONTRUST MULTI-ASSET INVESTMENT TEAM
John James Paul Kim Mayank Jen Causton Shayan
Husselbee Klempster Markanday Ratnasingam
PORTFOLIO CHANGES
BOUGHT SOLD
• n/a • Real Estate Credit Investments
• JPMorgan Sterling
Liquidity Fund
20views
CUMULATIVE RETURN
3 MONTHS 1 YEAR 3 YEARS 5 YEARS
Fund and share class 31 Mar 21 to 30 Jun 20 to 30 Jun 18 to 30 Jun 16 to
Total returns for the periods shown (%) 30 Jun 21 30 Jun 21 30 Jun 21 30 Jun 21
Liontrust MA Active Reserve S Inc 2.76 0.73 7.65 12.92
Liontrust MA Active Moderate Income S Inc 3.43 6.40 14.59 25.95
Liontrust MA Active Intermediate Income S Inc 4.52 13.91 20.92 40.54
Liontrust MA Diversified Global Income S Inc 3.47 14.59 11.31 22.11
IA Mixed Investment 20-60% Shares (benchmark) 3.61 12.74 15.28 32.09
Liontrust MA Monthly High Income S Inc 2.17 7.91 7.63 18.80
IA Mixed Investment 0-35% Shares (benchmark) 2.51 6.86 11.68 21.66
DISCRETE YEARLY PERFORMANCE
Fund and share class 30 Jun 20 to 30 Jun 19 to 30 Jun 18 to 30 Jun 17 to 30 Jun 16 to
Total returns for the periods shown (%) 30 Jun 21 30 Jun 20 30 Jun 19 30 Jun 18 30 Jun 17
Liontrust MA Active Reserve S Inc 0.73 3.75 3.00 -0.58 5.51
Liontrust MA Active Moderate Income S Inc 6.40 3.90 3.66 -0.14 10.07
Liontrust MA Active Intermediate Income S Inc 13.91 1.97 4.11 1.76 14.21
Liontrust MA Diversified Global Income S Inc 14.59 -6.07 3.41 -1.15 10.98
IA Mixed Investment 20-60% Shares (benchmark) 12.74 -0.63 2.89 2.44 11.86
Liontrust MA Monthly High Income S Inc 7.91 -3.11 2.93 0.07 10.30
IA Mixed Investment 0-35% Shares (benchmark) 6.86 1.27 3.20 1.34 7.50
Source: Financial Express, as at 30 June 2021. Total return figures are calculated on a single pricing basis. Performance figures are
shown in sterling unless otherwise specified. The fund performance figures are net of all fees. IA Mixed Investment 20-60% Shares is
the comparator benchmark for the Liontrust MA Diversified Global Income Fund. IA Mixed Investment 0-35% Shares is the comparator
benchmark for the Liontrust MA Monthly High Income Fund.
ASSET ALLOCATION FUND SELECTION
WHAT WORKED? WHAT DIDN’T? WHAT WORKED? WHAT DIDN’T?
• UK property • Alternatives • Primary Health Properties • International Public
• Convertibles • Tritax Big Box Partnerships
• Europe ex-UK equities • BlackRock European • Artemis Income
• US equities Dynamic
• AB American Growth
Past performance is not a guide to future performance. Do remember that the value of an investment and the income generated from
them can fall as well as rise and is not guaranteed, therefore, you may not get back the amount originally invested and potentially risk
total loss of capital. Please refer to page 24 for more information on the Key Risks.
21LIONTRUST
Specialist fund range
THE LIONTRUST MULTI-ASSET INVESTMENT TEAM
John James Paul Kim Mayank Jen Causton Shayan
Husselbee Klempster Markanday Ratnasingam
PORTFOLIO CHANGES
BOUGHT SOLD
• n/a • Real Estate Credit Investments
• JPMorgan Global Core
Real Assets
• BMO Commercial
Property Trust
22views
CUMULATIVE RETURN
3 MONTHS 1 YEAR 3 YEARS 5 YEARS
Fund and share class 31 Mar 21 to 30 Jun 20 to 30 Jun 18 to 30 Jun 16 to
Total returns for the periods shown (%) 30 Jun 21 30 Jun 21 30 Jun 21 30 Jun 21
Liontrust MA Diversified Real Assets A Acc 4.55 8.05 10.45 17.50
Liontrust MA UK Equity S Acc 5.86 21.86 9.69 43.33
IA UK All Companies (benchmark) 5.62 27.66 11.10 48.48
Liontrust MA Strategic Bond S Acc 2.16 4.57 5.83 14.99
IA £ Strategic Bond (benchmark) 1.82 6.13 16.02 24.36
DISCRETE YEARLY PERFORMANCE
Fund and share class 30 Jun 20 to 30 Jun 19 to 30 Jun 18 to 30 Jun 17 to 30 Jun 16 to
Total returns for the periods shown (%) 30 Jun 21 30 Jun 20 30 Jun 19 30 Jun 18 30 Jun 17
Liontrust MA Diversified Real Assets A Acc 8.05 -1.57 3.85 -0.34 6.74
Liontrust MA UK Equity S Acc 21.86 -11.15 1.31 6.94 22.19
IA UK All Companies (benchmark) 27.66 -11.03 -2.19 9.07 22.53
Liontrust MA Strategic Bond S Acc 4.57 -2.48 3.77 0.52 8.10
IA £ Strategic Bond (benchmark) 6.13 3.79 5.33 0.33 6.85
Source: Financial Express, as at 30 June 2021. Total return figures are calculated on a single pricing basis. Performance figures are shown
in sterling unless otherwise specified. The fund performance figures are net of all fees. IA UK All Companies is the comparator benchmark
for the Liontrust MA UK Equity Fund. IA £ Strategic Bond is the comparator benchmark for the Liontrust MA Strategic Bond Fund.
ASSET ALLOCATION FUND SELECTION
WHAT WORKED? WHAT DIDN’T? WHAT WORKED? WHAT DIDN’T?
• Social Infrastructure • Renewable Infrastructure • BMO Commercial • John Laing
• Commodities Property Trust Environmental Assets
• Speciality Real Estate • LF Lindsell Train UK Equity
Investment Trusts • LF Majedie UK Equity
• Global Corporate Bonds • Robeco Global Credits
Past performance is not a guide to future performance. Do remember that the value of an investment and the income generated from
them can fall as well as rise and is not guaranteed, therefore, you may not get back the amount originally invested and potentially risk
total loss of capital. Please refer to page 24 for more information on the Key Risks.
23IMPORTANT information
Key risks
Past performance is not a guide to future objectively so may be incorrectly priced, and may
performance. Do remember that the value of an at times be harder to sell. This could lead to
investment and the income generated from them reduced liquidity in the Fund. Some also invest in
can fall as well as rise and is not guaranteed, non-mainstream (alternative) assets indirectly
therefore, you may not get back the amount through other collective investment schemes.
originally invested and potentially risk total During periods of stressed market conditions non-
loss of capital. mainstream (alternative) assets may be difficult to
sell at a fair price, which may cause prices to
Some of the Funds managed by the Multi-Asset fluctuate more sharply.
Team have exposure to foreign currencies and
may be subject to fluctuations in value due to The Funds’ investments are subject to normal
movements in exchange rates. The majority of the fluctuations and other risks inherent when investing in
Funds invest in Fixed Income securities indirectly securities. The issue of units/shares in Liontrust Funds
through other collective investment schemes. The may be subject to an initial charge, which will have
value of fixed income securities will fall if the issuer an impact on the realisable value of the investment,
is unable to repay its debt or has its credit rating particularly in the short term. Investments should
reduced. Generally, the higher the perceived always be considered as long term. There is no
credit risk of the issuer, the higher the rate of certainty the investment objectives of the Fund will
interest. Bond markets may be subject to reduced actually be achieved and no warranty or
liquidity. Some Funds may have exposure to representation is given to this effect. The Funds
property via collective investment schemes. therefore should be considered as a medium to long-
Property funds may be more difficult to value term investment.
Disclaimer
This document is issued by Liontrust Fund Partners sources (which may have been used) which have
LLP (2 Savoy Court, London WC2R 0EZ), not been verified.
authorised and regulated in the UK by the
Financial Conduct Authority (FRN 518165) to All the information provided should be treated as
undertake regulated investment business. confidential, information may constitute material non-
public information, the disclosure of which may be
It should not be construed as advice for investment prohibited by law, and the legal responsibility for its
in any product or security mentioned, an offer to use is borne solely by the recipient. If this document
buy or sell investments mentioned, or a solicitation has been produced for a professional audience it
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please consult suitability with a regulated financial
The document contains information and analysis adviser before investing. Any decision to invest
that is believed to be accurate at the time of should be always based on the final Prospectus
publication, but is subject to change without notice. and Key Investor Information Documents (KIIDs).
Whilst care has been taken in compiling the content These documents contain important information
of this document, no representation or warranty, which should be read before investing in any fund
express or implied, is made by Liontrust as to its and they can be obtained, free of charge, from
accuracy or completeness, including for external www.liontrust.co.uk or direct from Liontrust.
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