DFO Reflections — Q4 2020

The final quarter of 2020 followed the good performance of previous quarters. Particularly corporate bonds (which were badly hit in the spring and whose returns were far behind those of government bonds) saw a massive recovery. This recovery was so strong that our investment components, which mainly contain corporate bonds, ended the year with higher total returns than those consisting mainly of government bonds. While this is quite normal, the crash in the spring of 2020 once again showed that corporate bonds should not be seen as „crash insurance“ – a fact that should definitely be taken into account when constructing quality investment portfolios.

The investment modules that focus on the shares of small and medium-sized companies as well as equities in developing markets also performed a brilliant spurt at the end of the year. All closed the year with positive returns.

As has already been emphasised several times, Das Family Office not only focuses on the currently very popular ETFs, but also analyses index funds and institutional share classes of actively managed funds. The latter achieved remarkable results last year, outperforming their respective benchmarks significantly. Only European indices, UK equities and certain sector components such as real estate (REITs) closed the year 2020 with losses.

Thus, contrary to many expectations, the year 2020 will go down in stock market history as a relatively good year. Those who kept their calm and held on to their quality equities in the Spring or even (like many of our clients) dared to take advantage of low prices, will have fond memories of 2020!

DFO relies on a long-established and highly-diversified invest- ment approach, which combines tried and tested investment components based on the respective FAIRHORIZONS. This means that the longer the time horizon of an investor, the higher the advised risk allocation should be. Conversely, higher allocations to risk should be avoided if the investment time horizons are short. This approach worked very well in 2020: our investment modules and reference portfolios all fulfilled the roles assigned to them and brought our clients through the Corona crisis very well.

If you have not yet become aware of Das Family Office, we would like to cordially invite and encourage you to take a look at our website, and reach out directly via [email protected]. Now we leave you to enjoy browsing through the various data and presentations of investment modules and reference portfo- lios. You will greatly benefit!