Economic Background and investment returns
2015 was a very challenging year for investment returns. The combination of concerns over the Chinese economy, sharply declining energy markets and the prospect of rising interest rates all combined to dampen investor sentiment. Divergent central banking policies also heightened volatility within currency markets.
Risk assets struggled against this backdrop and the equity portfolio declined by 11%. Bond yields remained at low levels and consequently fixed income portfolios were able to deliver positive performance. However, the decline in risk assets dominated and the overall portfolio return was -1% for the financial year.