Global equities lost ground in Q3 after strong gains in the first half of the year as the US Fed raised interest rates and indicated they’re not ready to pause hiking just yet. The US jobs market seems very strong even if overall inflation is on a downtrend. US tech giants fell.

Oil bubbled up and energy stocks were resilient as Saudi Arabia and Russia cut oil production.

China’s debt continues to worry as real estate prices keep sliding. The Chinese government tried to stimulate the market to no avail.

Government bonds declined in the quarter as yields rose. As the US continues to borrow more money, Fitch downgraded US debt from AAA to AA+. Still, the US Dollar, as indicated by strong jobs growth, strengthened against most currencies including the Ringgit a little over the last 3 months.

Things got interesting in the digital asset space. While Bitcoin and Ethereum fell sharply in the quarter, regulatory filings were made to start a crypto ETF. For investors, such launches would be akin to a kind of stamp of approval by the establishment.

On the whole, Bitcoin is still up a whopping 60% plus for the year.
 

Total Returns In USD 

<Source: Morningstar, Akru>

Total Returns In RM 

<Source: Morningstar, Akru>

While the poor market affected returns in the third quarter, Akru portfolios continue to perform respectably year-to-date. In ringgit terms, P1, the most conservative portfolio returned a commendable 5.8%. P10 chalked up 16.7%. Longer term, 1-year and annualised 3-year returns were very decent with P10 giving respectively 26% and 11% p.a.. Most of the returns were driven by US and developed markets but the strong USD against RM also gave an added boost.

Disclosures

Past data and performance do not indicate future performance. Actual individual investor performance will vary depending on the initial investment, amount and frequency of contributions, allocation changes, taxes and fees during the time frame considered.