TAM Bites is the latest addition to our adviser communications, which aims to provide you with regular bites of information relating to key market activity, and a brief insight into TAM’s process and strategy. Just scroll down to read on and enjoy!
Property funds (investment in commercial property) have become a cause for concern as many are now set to close. There are several recent examples of major institutions shutting down their property funds, and some others are “gating”, which means slowing or stopping redemptions. The funds are thus illiquid and may cause concern to clients needing cash at any time. Some years ago, the FCA sent out warnings to wealth managers detailing the potential illiquidity. TAM owns no property funds and excluded them from all our models on liquidity grounds seven years ago.
Fixed interest investment has been the most unfashionable area for some time now, and in 2022 many cautious and defensive portfolios fared miserably: even major institutional houses lost 15-20% in lower risk portfolios - not what cautious investors were expecting! With interest rates at a potential high and inflation, for now, seemingly under an element of control, a small bond rally has ensued. Anecdotally, the last two times interest rates were above 5%, the next 24 months saw bonds rally 25-30% - so watch this space! TAM is up to weight with its bond exposure in portfolios for the first time in five years.
Over the last couple of years, the big equity debate has been around growth stocks vs value stocks. The markets have sporadically been driven by one or the other… but not generally at the same time. Consequently, performance has waxed and waned based almost solely on the strategy adopted. TAM prefers to remain an “all-terrain” investor and has not substantively biased one market area over the other as we do not believe this volatility between growth and value is over. Rather than take the single shot approach to either strategy, TAM has looked for the best plays to both and combined them in a diversified approach… for now.
If you would like to speak with us about anything from this note, or to discuss our discretionary investment management services in general, please get in touch with our European manager, Tom, today: tom.worthington@tameurope.com