This is part of our quarterly plan performance series. Catch up on last quarter’s summary here: How PensionBee’s plans are performing in 2022 (as at Q4).
2023 began with a sense of cautious optimism, as financial information provider, S&P Global Market Intelligence, predicted that: supply chains would heal from the COVID-19 domino effect, inflation would slow significantly, and interest rate price hikes would peak in Spring. Looking back at the first quarter of this year, we’ve seen a slightly different landscape.
The notion of a soft landing from market turbulence was squashed when inflation remained stubbornly high and interest rates continued to climb upwards. In March, the banking sector was particularly challenged by these high interest rates. As fears of 2008 history repeating itself were felt strongly, investor confidence dropped and so did many global banks’ share prices. Fortunately, these fears didn’t materialise. Instead, global markets seem to have adopted a “let’s get on with it” attitude.
Keep reading to find out how global markets and our PensionBee plans have performed over 2023 so far. Please note there isn’t a Q1 update for our new Impact Plan, as it was launched in February 2023.
This blog’s only meant to provide information. The data comes from our money managers or factsheets. Performance figures are before fees and after taxes. Past performance isn’t an indicator of what will happen in the future. As with all investments, capital is at risk.
Company shares in Q1 2023
Global stock markets
While performance over the past 12 months is still down overall, the outlook for company shares in 2023 is cautiously optimistic. In a nutshell, the shifting fortunes of various industries and regions is another reminder to not keep all your eggs in one basket and ensure your investments are diversified.
| Index | Investment location | Performance over Q1 2023 (%) | Equity proportion (%) |
|---|---|---|---|
| FTSE 250 Index | UK | +0.4% | 100% |
| S&P 500 Index | North America | +7.0% | 100% |
Source: BBC Market Data
PensionBee’s equity plans
| Plan | Money manager | Performance over Q1 2023 (%) | Equity proportion (%) |
|---|---|---|---|
| Fossil Fuel Free Plan | Legal & General | +5.5% | 100% |
| Shariah Plan | HSBC (traded via SSGA) | +10.0% | 100% |
| Tailored (Vintage 2061 - 2063) Plan | BlackRock | +5.2% | 100% |
| Tailored (Vintage 2055 - 2057) Plan | BlackRock | +5.2% | 100% |
| Tailored (Vintage 2049 - 2051) Plan | BlackRock | +5.2% | 96% |
| Tailored (Vintage 2043 - 2045) Plan | BlackRock | +4.9% | 85% |
| Tracker Plan | State Street Global Advisors | +5.7% | 79% |
| Tailored (Vintage 2037 - 2039) Plan | BlackRock | +4.5% | 72% |
| Tailored (Vintage 2031 - 2033) Plan | BlackRock | +4.2% | 59% |
| 4Plus Plan | State Street Global Advisors | +2.1% | 52% ^ |
^ Equity % at 31 March 2023, as changes on a weekly basis due to actively managed components.
Investment performance is taken from money manager factsheets. To view factsheets, please visit our Plans page. All performance is reported in gross figures and may not take account of fees associated with certain investments. Past performance is not an indicator of future performance. Capital at risk.
^ Equity content refers to the amount of exposure each plan has to global stock markets and other listed risk-on assets, such as property and commodities.
Bonds in Q1 2023
Global bond markets
Bonds are finally recovering after a dismal performance in 2022. Investors have been lured by higher yields and bonds’ historical resilience during economic downturns like recessions. Bond funds have seen a rise in demand from investors so far this year, reversing the record disinvestment from bond markets that occurred in 2022.
| Fund | Source | Performance over Q1 2023 (%) | Fixed-income proportion (%) |
|---|---|---|---|
| Schroder Long Dated Corporate Bond Fund | Morningstar | +3.8% | 100% |
Source: Morningstar
PensionBee’s fixed-income plans
| Plan | Money manager | Performance over Q1 2023 (%) | Fixed-income proportion (%) |
|---|---|---|---|
| Preserve Plan | State Street Global Advisors | +0.9% | 100% |
| Pre-Annuity Plan | State Street Global Advisors | +3.2% | 99% |
| Tailored (LifePath Flexi) Plan | BlackRock | +3.7% | 60% |
| Tailored (Vintage 2025 - 2027) Plan | BlackRock | +3.9% | 51% |
Investment performance is taken from money manager factsheets. To view factsheets, please visit our Plans page. All performance is reported in gross figures and may not take account of fees associated with certain investments. Past performance is not an indicator of future performance. Capital at risk.
Summary
We’re currently still in a volatile market. The good news is global markets have recovered from every downturn in history. Moreover, the value of most global markets not only recovers, but typically goes on to reach new highs. Even the biggest market crash since the Great Depression, the 2008 global financial crisis, was followed by the longest period of sustained growth in market history until the COVID-19 pandemic struck in 2020.
You may find yourself rethinking your pension savings during the cost of living crisis, or worrying about whether you’re making the right choices. PensionBee customers can have peace of mind knowing that our pension plans are being managed by some of the world’s biggest money managers. Again, it’s worth remembering that it’s normal and expected for pensions to go up and down in value over time.
This is part of our quarterly plan performance series. Check out the next quarter’s summary here: How PensionBee’s plans are performing in 2023 (as at Q2).
Have a question? Get in touch!
You can check out our Plans page to learn how your money is invested in different assets and locations. You can always send comments and questions to our team via engagement@pensionbee.com.
Risk warning
As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice.
