The EV Asset Model is designed with the intention of providing a basis for calculating asset weights through optimisation for a given strategy. Changes induced by model updates imply changes in asset allocations that are a good response to changes in prevailing conditions.
Bonds have improved relative to cash in both risk and reward. In shorter terms, we believe that's enough to shift the portfolio balance to fixed income. This represents the most marked change in portfolio outlook this quarter.
UK Corporate Bonds have become more attractive following economic recovery and improving expectations for corporate fundamentals. Gaining some weighting in the portfolio at the expense of UK Government Bonds and Money Markets is less attractive at this point.
We have also seen UK Equities gain a little weight at the expense of other developed global equities.