Despite a bumpy start to the year for investment markets, I’m pleased to report that your portfolio has held up well. Much of this has to do with your energy investments, with energy shares up a massive 19% so far in 2022 (and that’s off the back of a great 2021). Now, following this period of strong returns, Morningstar have reduced your holding in these companies (thereby locking in some profits).

While this is indeed a great result, it has been a more challenging period for broader investment markets, with investor sentiment affected by two main issues:

Expectations around inflation (which can best be described as the tendency for goods and services to get more expensive over time) and interest rates are rising, which has the potential to impact everything from corporate profits to our own individual cost of living.

Russian and Ukrainian tensions have escalated significantly in recent weeks.

With this heightened share and bond market volatility, comes opportunity, and Morningstar have moved quickly to reinvest those proceeds; firstly, into quality global companies and secondly, with a specific allocation to South Korean shares. Both have been sold off a bit lately, but represent good long-term value, in their opinion.

A summary of these trades appears below:

All Growth

Action

Security /APIR Code

Security Name

Increased

INT0017AU

Morningstar International Shares Fund

Increased

IKO-AU

iShares MSCI South Korea ETF

Decreased

FUEL-AU

BetaShares Global Energy Companies ETF (AUD Hedged)

High Growth (90)

Action

Security /APIR Code

Security Name

Increased

INT0017AU

Morningstar International Shares Fund

Increased

IKO-AU

iShares MSCI South Korea ETF

Decreased

FUEL-AU

BetaShares Global Energy Companies ETF (AUD Hedged)

Aggressive (80)

Action

Security /APIR Code
Security Name

Increased

INT0017AU

Morningstar International Shares Fund

Increased

IKO-AU

iShares MSCI South Korea ETF

Decreased

FUEL-AU

BetaShares Global Energy Companies ETF (AUD Hedged)

 

Growth (70)

Action

Security /APIR Code

Security Name

Increased

INT0017AU

Morningstar International Shares Fund

Increased

IKO-AU

iShares MSCI South Korea ETF

Decreased

FUEL-AU

BetaShares Global Energy Companies ETF (AUD Hedged)

 

Balanced Growth (60)

Action

Security /APIR Code

Security Name

Increased

INT0017AU

Morningstar International Shares Fund

Increased

IKO-AU

iShares MSCI South Korea ETF

Decreased

FUEL-AU

BetaShares Global Energy Companies ETF (AUD Hedged)

 

Balanced (50)

Action

Security /APIR Code

Security Name

Increased

INT0017AU

Morningstar International Shares Fund

Increased

IKO-AU

iShares MSCI South Korea ETF

Decreased

FUEL-AU

BetaShares Global Energy Companies ETF (AUD Hedged)

+

Added

VAF-AU

Vanguard Australian Fixed Interest ETF

Decreased

QPON-AU

BetaShares Australian Bank Senior Floating Rate Bond ETF

 

All in all, while it remains a challenging investment environment, and one in which may see more volatiltity, Morningstar continues to see opportunities to invest in attractively priced assets and remains confident that your portfolio is well positioned to continue to achieve its longer-term objectives.