Damien’s May 2026 portfolio review – Back in America

The background to my portfolio

Back in March 2015 I decided to invest £50,000 of my own money using 80-20 Investor. The purpose was twofold, firstly to show how you can use 80-20 Investor to invest and outperform the market with only a few minutes of effort every now and then. Secondly, no other investment commentator, journalist or research provider invests their own money for fear of failing. This is a sorry state of affairs and is precisely why I committed to openly running my own portfolio for 80-20 Investor members to see.

Since then I have periodically changed my portfolio using the fund data provided by the 80-20 Investor algorithm and associated research. I always disclose the changes at the time they are made.

Performance update

The chart below shows how my portfolio has outperformed since I started the challenge in March 2015, over 11 years ago. The green line is the performance of my portfolio while the red line is the benchmark showing the average return achieved by professional fund managers given the same asset mix. To accurately calculate this I have used the average return for each sector in which my portfolio is invested. The blue line shows what the average multi-asset fund with comparable equity content achieved. In other words, the red line would show the extra performance added by just the asset mix of my portfolio (where I was invested i.e. European equities etc) over picking a typical multi-asset fund (the blue line), while the green line (which is my actual performance) shows the impact of being in the right funds at the right time, as identified by the 80-20 Investor algorithm.

April was a strong month for stock markets as investors moved on from worrying about the long-term impacts of the war in Iran, and so fear was replaced by greed. We saw numerous stock markets hit new all-time highs, including in emerging markets, the US and Japan. The exceptions were European stock markets and the FTSE 100. This was because not only are the latter deemed more at risk from a sustained oil price shock (when compared to the US) as both economies are net energy importers, but investors also poured back into AI stocks, US tech stocks and global chipmakers. It explains why my portfolio lagged both of its benchmarks this month. The fact that the red line (which has the same asset mix as my portfolio) and the blue line (the average professionally managed multi-asset fund) performed more or less in line with one another suggests that my actual fund choice (not asset mix) dampened my portfolio performance.

In April, we saw a move back to growth stocks, while value stocks and defensive sectors (like consumer staples) underperformed. When I say underperformed, they still made money, but not as much as AI stocks, which went parabolic during the month. You can see this in the table below, which shows the performance of the individual funds within my portfolio since my last review.

BNY Mellon Asian Income was the standout performer, which is unsurprisingly given its exposure to AI chipmakers in South Korea and Taiwan. It's a similar story, but to a lesser extent, with Artemis Global Income. At the opposite end of the scale, iShares 100 UK Equity Index (UK) and Artemis SmartGARP European Equity lagged, for reasons already stated. Gold also had a subdued month, with its negative correlation to the price of oil remaining in place.

 

Name	Performance since my last review (10th April)
BNY Mellon Asian Income	8.06
Artemis Global Income	3.23
M&G Global Strategic Value	3.23
Premier Miton Multi-Asset Growth & Income	2
abrdn High Yield Bond	1
Schroder Strategic Credit	0.67
Fidelity Global Dividend	0.1
abrdn Strategic Bond	0.1
Man Japan Core Alpha	-0.39
Artemis SmartGARP European Equity	-0.69
iShares Physical Gold ETC	-1.87
iShares 100 UK Equity Index (UK)	-3.27

As usual, the table below shows which funds within my portfolio are in the current BOTB or BFBS tables and which are not. Those funds in blue are still in the BOTB while those in grey are not in the BOTB but are in the BFBS list. Meanwhile, any funds in red have dropped out of both shortlists.

Fund	Allocation	Risk	Sector	ISIN Code
abrdn High Yield Bond	12.5	Lower	Sterling High Yield	GB00B79RR984
abrdn Strategic Bond	4.5	Lower	Sterling Strategic Bond	GB00BWK27X12
Artemis Global Income	15	Medium	Global Equity Income	GB00B5N99561
Artemis SmartGARP European Equity	7	Medium	Europe Excluding UK	GB00B2PLJD73
BNY Mellon Asian Income	7	Higher	Asia Pacific Excluding Japan	GB00B8KT3V48
Fidelity Global Dividend	6	Medium	Global Equity Income	GB00B7778087
iShares 100 UK Equity Index (UK)	11	Medium	UK All Companies	GB00B7W4GQ69
iShares Physical Gold ETC	8	Medium	Commodity & Energy ETF	IE00B4ND3602
M&G Global Strategic Value	6.5	Higher	Global	GB00B6173L33
Man Group Man Japan Core Alpha	7	Higher	Japan	GB00B0119B50
Premier Miton Multi-Asset Growth & Income	8.5	Medium	Mixed Investment 40-85% Shares	GB00B78H4K93
Schroder Strategic Credit	7	Lower	Sterling Strategic Bond	GB00BJZ2ZC09

Despite the continued market volatility, there is now one fund on the red list this month, having fallen out of the BOTB and BFBS tables, namely:

• abrdn Strategic Bond

Having only one fund on the red list is something of a rarity. Having said that, in recent months, I have removed funds from my portfolio that had become regulars on the red list. While my portfolio may have lagged its benchmarks in the last month, the 80-20 Investor algorithm also analyses momentum beyond such a short time frame.

Therefore, there is no need for drastic changes to my portfolio. However, I will switch out of abrdn Strategic Bond and also tweak my asset allocation to bring it closer to that of the BOTB. The chart below shows the recent performance of abrdn Strategic Bond versus the other bond funds in my portfolio. Not only has it underperformed (and is down year to date), but it has been fairly volatile for what should be a low risk fund.

As such, I am going to replace it with a fund from this month's BOTB, namely, TwentyFour Monument Bond. The chart below is the same as the one above, but also includes the new fund, which demonstrates its 'absolute return' qualities. The fund invests in asset-backed securities (such as loans and mortgages). While that may bring up memories of 2008, the fund focuses on European Assets (as opposed to US), which are heavily regulated.

The other change I plan to make this month is to slightly reduce my exposure in European and UK equities to be more in line with that of the BOTB. US equities have proved more resilient since the start of the Iran war, partly a result of the US not being reliant on energy imports, unlike the UK and Europe. On top of that, the return of the AI trade has sent the share price of technology giants and chipmakers soaring. It's debatable whether this short-term burst in momentum will develop into anything more sustainable, nonetheless, the US stock market indices are now starting to lead their global peers.

The simplest way to reduce my European and UK equity exposure is to reduce my holdings of Artemis SmartGARP European Equity and iShares 100 UK Equity Index (UK). Both funds are still in the BFBS tables, and Artemis SmartGARP European Equity remains in the BOTB. Although they haven't enjoyed as much of the market rebound (as you can see from the earlier performance table), iShares 100 UK Equity Index proved resilient during the height of the tensions in the Middle East, a situation which has yet to be resolved. This resilience is part of the reason it merited a place in my portfolio.

At the moment, we don't know how the situation in the Middle East will be resolved and so perhaps caution is still warranted. In order to increase the US equity exposure of my portfolio the proceeds of the sales will be invested in Artemis US Select. I had considered both North American funds in the BOTB and would have opted for T. Rowe Price US Large Cap Value Equity, but alas the investment platform I use does not provide access to it.

At just 5% of my portfolio, the new US equity holding is relatively small so I was happy to take some risk with the fund choice and pick Artemis US Select, from the BFBS, which has performed largely in line with the Schroder US small cap in the last few months but has benefited from the rebound in US tech stocks. Of course if the rally in tech stocks (or US stocks for that matter) unravels then the new fund will be negatively impacted.

Overall, the fund switches only impact just over 9% of the assets in my portfolio, but bring my asset mix more in line with that of the BOTB. It also means that my portfolio now has 13 holdings rather than 12.

Fund switches

I am making the following fund switches:

• 100% out of abrdn Strategic Bond and 100% into TwentyFour Monument Bond
• 30% out of Artemis SmartGARP European Equity and 30% out of iShares 100 UK Equity Index (UK) and 100% into Artemis US Select

My new portfolio now look like this:

Fund	Allocation	Risk	Sector	ISIN Code
abrdn High Yield Bond	12	Lower	Sterling High Yield	GB00B79RR984
Artemis Global Income	15.5	Medium	Global Equity Income	GB00B5N99561
Artemis SmartGARP European Equity	5	Medium	Europe Excluding UK	GB00B2PLJD73
Artemis US Select	5	Higher	North America	GB00BMMV5105
BNY Mellon Asian Income	7.5	Higher	Asia Pacific Excluding Japan	GB00B8KT3V48
Fidelity Global Dividend	6	Medium	Global Equity Income	GB00B7778087
iShares 100 UK Equity Index (UK)	7	Medium	UK All Companies	GB00B7W4GQ69
iShares Physical Gold ETC	8	Medium	Commodity & Energy ETF	IE00B4ND3602
M&G Global Strategic Value	6.5	Higher	Global	GB00B6173L33
Man Group Man Japan Core Alpha	7	Higher	Japan	GB00B0119B50
Premier Miton Multi-Asset Growth & Income	9	Medium	Mixed Investment 40-85% Shares	GB00B78H4K93
Schroder Strategic Credit	7	Lower	Sterling Strategic Bond	GB00BJZ2ZC09
TwentyFour Monument Bond	4.5	Lower	Specialist	GB00B3V5V897

 

My Portfolio asset mix

My portfolio asset mix still has approximately 64% exposure to equities. Last month's figures are shown in brackets.

• UK Equities 10% (14%)
• North American Equities 16% (9%)
• Asian Equities 7% (7%)
• Emerging Market Equities 5% (5%)
• Japanese Equities 9% (9%)
• European Equities 10% (13%)
• Other International Equities 7% (7%)
• Commodities and energy 8% (8%)
• UK Fixed Interest 2% (5%)
• Global Fixed Interest 19% (18%)
• Cash 0% (0%)
• Alternative Investment Strategies 7% (5%)

Damien's higher risk and lower risk portfolios

Using the logic described in my post: Update to Damien’s alternative risk portfolios I created hypothetical higher and lower risk versions of my portfolio below:

Lower risk

Fund	Allocation %
abrdn High Yield Bond	16
Artemis Global Income	21
Artemis SmartGARP European Equity	7
Fidelity Global Dividend	8
iShares 100 UK Equity Index (UK)	9
iShares Physical Gold ETC	11
Premier Miton Multi-Asset Growth & Income	12
Schroder Strategic Credit	10
TwentyFour Monument Bond	6

 

Higher risk

Fund	Allocation %
Artemis Global Income	20
Artemis SmartGARP European Equity	7
Artemis US Select	7
BNY Mellon Asian Income	10
Fidelity Global Dividend	8
iShares 100 UK Equity Index (UK)	9
iShares Physical Gold ETC	10
M&G Global Strategic Value	8
Man Group Man Japan Core Alpha	9
Premier Miton Multi-Asset Growth & Income	12