Where we invest your money - Finance Director, Jamie Bellamy

Posted on June 14, 2018

The Society’s With-Profits fund investment strategy takes a cautious approach to invest into a diverse portfolio of assets, with a bias towards directly owned commercial property. This is mainly due to the consistency of return provided year on year and the experience built up within the Society and Committee. We now own over 40 properties nationwide, but focussed within the Yorkshire heartland, ranging up to £3.3 million in value. Two new acquisitions were made in 2017, whilst also completing the final instalment on a staged completion where the land was acquired in 2016. The new acquisitions were a hotel in Huddersfield, tenanted by Travelodge and a retail development at Chorlton, Greater Manchester, tenanted by M&S and Barnardo’s. Both new properties have the benefit of long-term commercial leases backed by strong covenants. In 2017 your Committee also took the decision to invest into a UK Property Fund held with Schroders, providing exposure into the South East and London and larger property developments, outside the scope of the Society’s directly owned properties mandate.

The Society also invests in UK listed investments, Government Gilts and Corporate Bonds, via our investment manager, Investec. The main objective here is to invest in high quality fixed interest and blue chip equity investments. The FTSE 100 had a great year, finishing 2017 on a record high of 7687.77 helping to achieve a strong return. Over the course of 2017, the Committee also decided to increase the size of the fixed interest portfolio. This was a prudent move to achieve a reduction in the risk profile of the asset portfolio, which will be continued in 2018.

A relatively new addition to the asset mix is the emerging market fund investment with Fidelity. The purpose of this fund is to provide the Society with overseas equities exposure, access to potentially higher returns and less reliance on UK economic conditions. This particular fund is seen as more volatile than traditional listed investments and therefore
the investment is minimal compared with the rest of the investment portfolio.
Due to the diversity in the funds, 2017 was an excellent year in terms of investment asset growth, which again has made it possible to provide competitive returns on our products.

 

Asset Allocation

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