STIFTUNGSCHWEIZ AND ZÜRCHER KANTONALBANK
Swiss Philanthropy Performance Index
Swiss Philanthropy Performance Index
SwiPhiX reaches new all-time high
In July, the market value of the average portfolio in the Swiss Philanthropy Performance Index
(SwiPhiX) rose by 1.3%.
The performance range of the portfolios represented in the index as a whole was between -0.6% and 3.0%.
Thanks to the positive performance in July, the SwiPhiX reached a new all-time high of 152.7 points, one tenth of a percentage point above the previous high water mark of the end of 2021.
Market expects more interest rate hikes in the USA
Due to low US inflation and rising unemployment in the US, the market again priced in more future interest rate cuts by the US Federal Reserve in July, which would benefit indebted companies. On the commodities market, the expected economic slowdown weighed on the price of crude oil due to falling demand. By contrast, the price of gold rose because lower key interest rates mean lower opportunity costs for holding gold, making it a more attractive investment. A negative factor is that global equity markets are highly valued by historical standards in terms of price/earnings ratios.
Particularly in view of the relatively expensive valuations of equities and the seasonally difficult months of August and September, we are more cautious about the outlook for equities than we were a month ago. Regionally, we favor the Swiss, UK and emerging markets. In terms of bonds, we prefer foreign government bonds because they offer an attractive risk/return ratio.
OUTLOOK
Data source
Mandates managed by Zürcher Kantonalbank Asset Management serve as the data source for SwiPhiX. Only mandates for which it can be assumed that the implemented strategy is representative for the investment strategy of the nonprofit organization are selected for the calculation. At present, 79 different mandates with an average size of around CHF 48 million and a total volume of around CHF 3.8 billion are taken into account.
Calculation
All mandates are weighted equally when calculating the average performance of SwiPhiX. The current index value is calculated as the index value of the previous month, plus the average performance in the current month. All performance figures are gross performance, i.e. the (individual) costs for asset management are not included.
Dispersion of performance figures
The development of the individual mandates is naturally very different due to the diverging strategies. To illustrate the scatter range, the tables show the respective minimum and maximum performance from the totality of all mandates recorded over different time periods.
Asset allocation
The performance of a portfolio depends on the development in the individual asset classes. The chart below shows the current average
allocation across the various asset classes.
August 2024
New benchmark index for the investment performance of nonprofit organizations
LEGAL NOTES:
This document is for information and advertising purposes. It is intended for distribution in Switzerland and is not intended for investors in other countries. This document constitutes neither an offer nor a recommendation to buy, hold or sell financial instruments or to purchase services, nor does it form the basis of a contract or an obligation of any kind. The document has been prepared by Zürcher Kantonalbank with the care customary in the business and may contain information from carefully selected third-party sources. Zürcher Kantonalbank offers no guarantee for the accuracy and completeness of the information contained in this document and disclaims all liability for damages resulting from the use of the document or information contained therein. Every investment is associated with risks, in particular with regard to fluctuations in value, income and possibly currency. Past performance and returns are not a reliable indicator of future results. The performance figures do not take account of fees and any other costs. The Swiss Philanthropy Performance Index is not a basis for products. Index adjustments affecting the composition or weighting will be communicated in an appropriate manner. Zürcher Kantonalbank reserves the right to discontinue the index calculation without giving reasons. © 2024 Zürcher Kantonalbank. All rights reserved.
Swiss Philanthropy Performance Index
Securities portfolios lose 0.9%
As we already pointed out in the last performance report, higher fluctuations are to be expected in the recovery of the Swiss Philanthropy Performance Index (SwiPhiX). After the initial euphoria, the underlying securities portfolios lost an average of 0.9% in February (previous month: +3.7%). As usual, the performance of the individual portfolios was quite varied, ranging from -1.8% to +0.7%. On average, the margin is 2.8 percentage points. Performance since the beginning of the year has been positive for all portfolios, averaging 2.7%.
High inflation likely to persist in 2023
A robust labor market and strong economic data are making the fight against inflation more difficult. This prompted U.S. Federal Reserve Chairman Jerome Powell to signal further interest rate hikes in his latest speech, which dampened investor sentiment on the stock markets. As a result, long-term bonds also lost value. The interest rate increases are also noticeable in the average allocation of SwiPhiX: at 7%, the liquidity share is 2% higher than in January. Although no global recession is expected, the year will still be one of sustained low growth.
OUTLOOK
Data source
Mandates managed by Zürcher Kantonalbank serve as the data source for SwiPhiX. Only mandates for which it can be assumed that the implemented strategy is representative for the investment strategy of the nonprofit organization are selected for the calculation. Currently, 75 different mandates with an average size of about CHF 41 million and a total volume of about CHF 3.1 billion are considered.
Calculation
For the calculation of the average performance, all mandates are weighted equally. The current index value is calculated as the index value of the previous month, plus the average performance in the current month. All performance figures are gross performance, i.e. the (individual) costs for asset management are not included.
Dispersion of performance figures
The development of the individual mandates is naturally very different due to the diverging strategies. To illustrate the scatter range, the tables show the respective minimum and maximum performance from the totality of all mandates recorded over different time periods.
Asset allocation
The performance of a portfolio depends on the development in the individual asset classes. The chart below shows the current average allocation across asset classes.
March 2023
New benchmark index for the investment performance of nonprofit organizations
LEGAL NOTES:
This document is for promotional purposes and is not intended for people domiciled or resident abroad. It was prepared by StiftungSchweiz and Zürcher Kantonalbank with due diligence as customary in business. However, StiftungSchweiz and Zürcher Kantonalbank do not guarantee the accuracy and completeness of the information contained therein and disclaim any liability arising from its use. The Swiss Philanthropy Performance Index is not a basis for products. StiftungSchweiz and Zürcher Kantonalbank reserve the right to discontinue the index calculation without giving reasons. Past performance and returns are no guarantee of future investment success. This document is neither an offer to conclude a contract nor an invitation to submit an offer for products and services. It does not constitute an offer or a recommendation to acquire, hold or sell financial instruments.
© 2023 StiftungSchweiz and Zürcher Kantonalbank