RIA: Portfolio Performance Review – Nov 2024

November 2024 exhibited steady growth in both equity and sukuk (Islamic bonds) investments, with significant contributions from ASN Equity Malaysia, which continued its strong performance trajectory.

Very Aggressive portfolio is the top performer (+0.62%), benefited heavily from the higher allocation to ASN Equity Global and ASN Equity Malaysia while Very Conservative portfolio experienced steady growth (+0.55%) with its large sukuk exposure, offering consistent, low risk returns.

YTD performance highlights the strong gains in more aggressive portfolios, driven by the outstanding YTD return of ASN Equity Malaysia (+30.27%) and ASN Equity Global (+12.21%). Since Ria launched, returns indicate a gradual upward trend across all portfolios, with more aggressive portfolios yielding higher cumulative returns.

Market Commentary – November 2024

Global equities trends from before the US election largely persisted through November, though a few warning signs in valuation spreads and correlations are flashing risk as the new year approaches.

Developed market financial sector valuations have normalized to levels before the Great Financial Crisis.

Positive economic data from the US and Eurozone, including lower-than-expected inflation figures and resilient GDP growth, supported investor confidence.

Strong earnings from large-cap tech and consumer companies outpaced expectations, driving market momentum.

The US Federal Reserve signalled a pause in rate hikes, reinforcing optimism in equity markets.

Similarly, the European Central Bank maintained a stable stance, which bolstered investor sentiment.

Technology and healthcare sectors were among the top performers, benefiting from sustained demand and innovation-driven growth.

Ongoing tensions in Eastern Europe and trade uncertainties with China kept markets on alert, limiting further gains.

Meanwhile the US dollar surged in November, and its rally may be a by-product of investors piling into US stocks, presented headwinds for emerging markets and multinational corporations with significant overseas exposure.

Malaysian equities experienced a more subdued month compared to their strong year-to-date performance but still managed to post gains, driven by a supportive domestic environment.

Malaysia's economy continued to show robust growth, with strong consumer spending and government infrastructure initiatives boosting investor confidence.

Higher crude oil and palm oil prices provided support to the oil & gas and plantation sectors, two key components of the Malaysian stock market.

The relatively stable Malaysian ringgit and attractive valuations in the equity market attracted foreign investors, though inflows were moderated by global risk factors.

The performance of neighbouring markets like Indonesia and Thailand occasionally diverted foreign investments.

The Malaysian sukuk market delivered steady returns in November, fulfilling its role as a low-volatility, income-generating asset class.

Bank Negara Malaysia maintained a cautious approach to monetary policy, with no changes in the Overnight Policy Rate (OPR), supporting sukuk yields.

Amid global uncertainties, investors continued to favor sukuk for its stability and compliance with Shariah principles, making it a preferred choice for institutional and retail investors alike.

Malaysia’s strong position as a global leader in Islamic finance attracted sustained interest from foreign investors, particularly in sovereign sukuk offerings.

Although inflation remained manageable, any uptick could pressure fixed-income instruments.

Liquidity in the secondary sukuk market remained tight, which could pose challenges for large-scale portfolio rebalancing.

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