Q3 2025
MPS QUARTERLY UPDATE
We increased our European equity allocation across the Real Return mandates, reflecting our growing conviction in the region’s improving outlook. With inflation largely under control and the European Central Bank further along its easing cycle than the Federal Reserve or the Bank of England, conditions are increasingly supportive. In addition, after a decade of prudence, upcoming fiscal expansion in Germany should provide a further boost to growth in the region.
As part of this positioning, Real 3 and Real 4 portfolios now include the Ardtur Continental European Fund, which we believe is well placed to benefit from these regional tailwinds.
At the same time, we used this opportunity to de-risk Real 2 portfolios by taking some profits from our US equity exposure, where valuations appear stretched. The proceeds were reallocated to fixed income, where yields remain compelling as well as the opportunity for capital appreciation as interest rates move lower.
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