Bond Reserve Portfolio
Overview
To outperform cash.
Actively managed. This well-diversified portfolio is made up of cash, credit and fixed interest investments. It normally invests in a wide range of ETFs to gain significant diversification and exceptional liquidity at very low cost.
| Stock Short Name | Percentage of Portfolio |
|---|---|
| iShares Core UK Gilts UCITS ETF | 20.8 |
| VANGUARD INV SER-UK GILT UCITS ETF | 20.8 |
| SPDR Sterling Corporate Bond UCITS ETF | 10.9 |
| ISHARES II PLC-USD FLTG RATE BOND U | 10 |
| SPDR Bloomberg 15+ Year Gilt UCITS ETF | 9.8 |
| iShares Core £ Corp Bond UCITS ETF | 8 |
| Invesco UK Gilt 1-5 Year UCITS ETF | 7 |
| iShares GBP Ultrashort Bond UCITS ETF | 6.6 |
| iShares GBP Corp Bond 0-5yr UCITS ETF | 5.9 |
| Number of Holdings | Yield to Maturity | Maturity | Duration | S&P Rating |
|---|---|---|---|---|
| 144 Govt. Bonds 1,665 Corp. Bonds | 4.99% | 9.74 | 6.26 | A/A- |
| Bond Reserve | 4.1% |
|---|---|
| Asia Pacific Ex. Japan (MSCI Asia Ex Jap) | 16.4% |
| Em Markets (MSCI EM) | 15.9% |
| Japan (MSCI Japan) | 14.4% |
| US Equities (MSCI USA) | 12.3% |
| UK Equities (MSCI UK) | 10.4% |
| UK Index-Linked Gilts (Barclays UK Infl Linked) | 9.7% |
| Europe Excl UK (MSCI Eur. Ex UK) | 9.6% |
| UK Gilts (Bloomberg UK Govt All>1 Yr) | 7.2% |
| UK Corp Bonds (iBoxx Large Cap TRI Index) | 5.6% |
Performance is based on the monthly performance of the first client discretionary portfolio after all charges. Individual client portfolios may differ due partly to differences in the timing of initial investment or withdrawals or rebalancing. The MoneyShe Bond Reserve (GBP) Benchmark is the Barclays Benchmark Overnight GBP Cash Index. Competitor data is based on the performance of the IA Global Mixed Bond Sector and the comparison is offered as a guide only.
| 12m to 30/04/2021 | 12m to 30/04/2022 | 12m to 30/04/2023 | 12m to 30/04/2024 | 12m to 30/04/2025 | 12m to 30/04/2026 |
|---|---|---|---|---|---|
| 5.6% | -9.6% | -3.4% | 4.8% | 4.9% | 1.7% |
Source: SCM Private LLP
Past performance is not a guide to future returns. The value of investments and the income from them can go down as well as up, so investors may not recover the amount of their original investment.
| ALL Fees & Charges | Percentage |
|---|---|
| SCM Discretionary Fund Management Charge | 0.40% |
| Underlying ETF costs (KIID Ongoing Charge) | 0.19% |
| Transaction Costs of buying/selling funds | 0.12% |
| Transaction Costs within funds | 0.07% |
| Custody & Administration Fee | 0.12% |
| Total Fees & Charges | 0.90% |
No changes were made to the SCM/MoneyShe Portfolios during April.
April delivered one of the sharpest reversals in recent memory. After March’s repricing in response to the oil shock and the most serious military confrontation in the Gulf for a generation, risk assets staged a wholesale rebound. The Nikkei led the developed world, up roughly 16% in local currency, with the NASDAQ and MSCI Emerging Markets both gaining close to 15%. The S&P 500 returned around 10.5%, the DJ Stoxx 600 rose 5.5%, and European banks and Italian equities each added 10%. The FTSE 100, which held up best in March, returned a more modest 2.5% in sterling terms.
The divergence between asset classes has become unusually stark. Every major equity index ended April positive, and copper added 5%, yet gilts were modestly negative, gold drifted lower, silver fell 2%, and Brent crude was down close to 3%. Equity and bond returns have decoupled to a degree that should make any disciplined asset allocator pause.
The Great Bond Breakout
The most consequential development was the synchronised rise in long-dated developed-market yields. Thirty-year gilts reached around 5.7%, the highest since the late 1990s, with US Treasuries near 4.7%, French OATs at 4.4%, and even Japanese JGBs at a multi-decade high close to 3.9%. As one Barclays strategist put it, in four countries with four different central banks, the same trade is being expressed simultaneously: “get me out of duration.”
Ten-year breakeven inflation rates have surged in Germany (1.8% to 2.3%) and Japan (1.5% to 2.2%) as the unresolved Strait of Hormuz disruption feeds inflation expectations. JP Morgan now estimates that OECD oil inventories could approach “operational stress levels” by early June, and inflation pressures appear to be bubbling under the surface, leaving central banks in a clear policy bind.
Earnings versus Valuations
US equities largely shrugged off these pressures. In the S&P 500, Q1 EPS growth rose from 13.4% in Q4 to 24.6%, a four-year high and arguably the strongest underlying earnings growth in two decades. All 11 sectors posted growth for the first time in four years. Even so, the gap between the S&P 500 earnings yield and the 10-year Treasury yield has turned negative for the first time since the aftermath of the dot-com bust in early 2002. Earnings are supporting the market, but valuations leave little margin for error.
SCM/MoneyShe Portfolios
The SCM/MoneyShe Portfolios participated strongly in April’s rebound. Broad international equity exposure – Japan, Europe and selected emerging markets, delivered meaningfully, outperforming US-tilted benchmarks. With 10-year gilts now back above 5% and the long end at multi-decade highs, yields on offer remain attractive against the medium-term inflation outlook.
Our discipline remains unchanged: broad diversification, underweight in the most concentrated and most expensive parts of the US market, and a willingness to act decisively when the market presents us with a clear mispricing.
Alan Miller, Chief Investment Officer
19 May 2026