Global investors targeted UK portfolios that held significant non-sterling assets following the Brexit vote.
Natixis Global Asset Management’s (NGAM) annual Global Portfolio Barometer found that the fall in the value of sterling propelled UK portfolios to the top of last year’s portfolio performance in countries such as the US and Singapore, as well as Europe.
UK portfolios significantly outperformed the US, which came second in the survey. The average performance of UK portfolios last year was 13% – significantly higher than the US – where portfolios returned an average of 8.2%.
Matthew Riley, head of research of the portfolio research and consulting group at NGAM said a UK investor with un-hedged US equity exposure would have gained an extra 19% return in 2016 due to the depreciation of the pound versus the dollar.
He added that for Eurozone equities, the extra return would have been around 16%, and for Japanese equities 23%.
“In equities, these currency-related returns were more than the returns of the underlying equity markets,” said Riley.
The NGAM survey covered investors in the US, the UK, France, Italy, Luxembourg, the Netherlands, Singapore and Latin America.
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