Weightings and optimisation
Total Weightings
Our portfolio is mathematically structured to prioritize capital preservation while capturing defensive growth. The allocation is anchored by Tesco PLC (30.0%) and BAT PLC (22.5%), two "value-oriented" giants that offer stable cash flows and price-inelastic demand in volatile markets.
To ensure stability, we have diversified across four distinct sectors and included UK 5-year Gilts (7.5%) as a near risk-free anchor to protect against inflationary erosion. This distribution ensures that no single equity over-concentrates the portfolio's risk, adhering to our strict weighting limit of 30% per asset.
Statistical Optimisation
The final portfolio composition is the result of a rigorous Sharpe Ratio optimization conducted via Excel. By analyzing five years of historical data, we balanced projected Annual Returns (ranging from 3.89% to 15.14%) against Standard Deviation to identify the most efficient risk-adjusted path.
Key Statistical Highlights
- Weighted Beta of 0.563: By selecting low-volatility assets like Abbott Laboratories (Beta: 0.372) and Iberdrola (Beta: 0.540), we have created a safety net that is significantly less sensitive to market swings than the broader FTSE 100.
- Optimised Constraints: To maintain our "Defensive Growth" strategy, we applied specific Min/Max constraints; ensuring a minimum 10% exposure to core equities while capping hedges like TotalEnergies (7.11%) to prevent over-leverage.
- Targeting Performance: This mathematical rigor allows us to target a 10-12% annual return even in the event of a significant macroeconomic correction or the bursting of the AI Bubble.
Our Partners
