MIRABAUD (CH) - Lemania Pension Fund MIX (LPFX) K Cap. CHF

Performance update

Markets were heavily influenced by interest rate decisions from major central banks. The biggest surprise was the new Swiss National Bank Board's decision to cut the key interest rate by 0.5%, while the market had expected only 0.25%. The European Central Bank and the Federal Reserve (Fed) each lowered their key interest rate by 0.25%, but Fed Chairman Powell's hawkish comments on inflation caused some concern. As a result, long-term interest rates rose significantly, more so in the US than in Europe and Switzerland. This led to a negative performance contribution from the bond allocation, with long bonds suffering the largest losses. In foreign currency bonds, gains from USD, GBP, and EUR partially compensated for the losses due to the increase in yields. Equity markets also suffered a setback towards the end of the year, with highly valued US stocks correcting more strongly than those in Europe and Switzerland, while Japan delivered positive performance. Real estate funds had another positive month and closed the year at all-time highs. On the downside, a liquid alternative fund holding and gold ETF both generated negative contributions.

Portfolio activity

We invested the subscription that we received towards the end of the month. We took into account the rebalancing, as the subscription was coming towards the end of the fourth quarter, so only minor adjustments were needed to align allocations into the new year.