June was a good month for our tactical asset allocation (TAA) portfolios. The exposure to global equities (and by extension US shares) through maintaining positions tracking the MSCI World index were rewarded as confidence in America rebounded. As we review the TAAs, however, we must note the serious uncertainty that is brewing.
IC Alpha strategies with TAACautious Balanced Moderate riskAdventurousJune ‘25 one mth TR (%)1.671.982.162.49minus mthly charges (7bps) 1.601.912.092.42TR since Sep ‘24 inception4.054.775.276.13ARC equivalent Cautious BalancedSteady GrowthEquity Risk June ‘25 TR inc. costs (%)1.101.401.701.90ARC since Sep ‘24 (%)3.032.752.782.83Source: Investors’ Chronicle, LSEG, ARC Suggestus ARC Wealth Indices
Our rebalances are mechanical at the end of each month, so have been done based on a data cut-off point before, quite literally, the five-to-midnight horse-trading as the US Congress battles over an enormously consequential tax and budget bill. At market close on 30 June, there was optimism that the so-called ‘Big, Beautiful Bill’ would pass, and a final version then made it through the Senate thanks to the tiebreaking vote cast by vice-president JD Vance. Many changes had been made to the original version approved by the House of Representatives at the end of May, and at the time of writing the iteration scrutinised and amended by the Senate had to go back to the House for approval.