The most recent analysis that ARC has put together, for Q3 2011, described the period as “the worst quarterly PCI results yet recorded”, including 2008. Its full-year 2011 analysis is expected to be available in around six weeks’ time.
In his Q3 report, chief executive Graham Harrison wrote: “Losses from sterling-denominated private client portfolios were worse in the third quarter of 2011 than in any other calendar quarter since the inception of the PCI indices in December 2003. This, on the face of it, is an alarming result.
Whatever parallels have been drawn with Q3 2008, until now the worst quarter since records began, the banking system remains intact and we have not entered an economic slump.”
The 2011 estimates for its sterling-denominated portfolios show each of its Cautious (-0.9%), Balanced (-3.4%), Steady Growth (-4.8%) and Equity Risk (-7%) Private Client Indices returning negative year-end figures. While they are still estimates, they are unlikely to be revised to compare with how bad 2008 was, with the indices returning -3.98%, -12.38%, -17.95% and -21.825% respectively.
Looking at each month’s discrete returns, private client portfolio managers managed to lose clients money more often than they made money during 2011.
Having said this, Harrison’s conclusion is likely to be the same as it was in Q3: “In conclusion, we reiterate the importance of not looking at a single calendar quarter or a single calendar year’s PCI results in isolation. Investors need to be as aware of this issue as they should be of the sensationalist tone of the headline writers.”
