Our Returns in 2023

24 January 2024

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Last year was filled with investing ups and downs – a rollercoaster for the markets. During this bumpy ride, our portfolios maintained defensive allocations, with our investment framework, ERAA®, placing us in a stagflationary regime of elevated inflation and slowing growth.

This positioning supported our portfolios’ returns in 2023, especially when accounting for the heightened volatility that we’ve seen in markets, and helped them to beat their benchmarks on a risk-adjusted basis. And on an absolute basis, our portfolios produced strong returns.

Starting with the big picture, 2023 was a decent year for returns from both global equities and bonds: about 23% and 5%, respectively. That’s a turnaround from the 18% slump that both asset classes faced in 2022, and compares well with the longer term average of about 9% for equities and 5% for bonds since the late 1980s.

But if you zoom into 2023, you’ll see that getting to that point has been a bit of a bumpy ride. At the end of Q1, we saw a brief blowup in markets amid the collapse of Silicon Valley Bank and Credit Suisse – until US and European central banks came to the rescue. The following months saw an AI-driven stock market rally, with the Magnificent 7 leading the charge. 

Then, midway through Q3, strong economic data, stubborn inflation, and a hawkish US Federal Reserve contributed to a broad-based sell-off in markets. As recently as end-October, equity returns stood at only about +6% and bond returns were in the red, at about -4%.

Then, market sentiment quickly shifted – and both stock and bond markets rallied again as inflation trended lower, the US jobs market showed more signs of cooling, and the Fed signalled the prospect of rate cuts in 2024. 

In the end, 2023 was a great example of how you never know when the markets will turn, and why staying invested in a diversified portfolio, appropriate to your risk tolerance, can help you manage risk and capture opportunities.

With that in mind, let’s dive into how our portfolios performed in Q4 2023 and 2023 as a whole:

  • General Investing portfolios powered by StashAway
  • General Investing portfolios powered by BlackRock
  • Responsible Investing portfolios 
  • Thematic portfolios

General Investing portfolios powered by StashAway

StashAway’s General Investing (GI) portfolios posted strong absolute returns across StashAway Risk Indexes (SRIs) during Q4. But due to a more defensive positioning, these gains were less pronounced than their same-risk benchmarks. They were up +7.4% on average in USD terms. Compared with an average +9.5% gain for their same-risk benchmarks.

For the year as a whole, our portfolios also saw robust absolute returns. They were up +11.8% on average versus average gains of +13.3% for their same-risk benchmarks. 

In the past two years, our defensive tilt has helped us to restrict drawdowns experienced by same-risk benchmarks during the period. However, as 2023 ended with a strong rally in many asset classes, our positioning also resulted in more subdued absolute returns versus their same-risk benchmarks.

On a risk-adjusted basis, however, our portfolios experienced lower volatility and outperformed their same-risk benchmarks. On average, our GI portfolios posted volatility of 6.2% in USD terms, versus 7.6% for their benchmarks in 2023. The smaller the number, the better.

Ultimately, this resulted in better volatility-adjusted returns versus our benchmarks, or a ratio of 1.9 in 2023, compared with 1.7 for their same-risk benchmarks. This time, the higher the number, the better. (Note: this ratio measures the return for each unit of risk taken.)

Understanding the impact of good risk management

That lower volatility in our portfolios also means protection against drawdowns when the market goes south – and this helps with performance over longer time periods.

In the chart below, you can see that it has helped our portfolios’ average performance versus their benchmarks over the past two years of heightened market volatility – or by about 5 percentage points on average.

Tech and large-cap stocks supported equity returns in Q4 and 2023

Our allocations to US technology stocks and large-cap equities were among the main contributors to our portfolios’ performance in Q4, especially in our higher-risk SRIs. These asset classes received a big boost from the shift in market sentiment at the end of October, as a more favourable macro environment and the prospects of lower interest rates contributed to a rally in risk assets.

Zooming out to the year as a whole, these equity asset classes were also the largest contributors to our portfolios’ performance in 2023. We attribute that to the rotation in our equity exposure from small-cap to large-cap stocks, which tend to be more stable during times of economic uncertainty. That, paired with our exposure to large-cap tech, helped us to ride the AI wave last year.

Less supportive for our portfolios were our allocations to US energy stocks, which underperformed amid sliding oil prices, and healthcare equities, which lagged as investors flocked to tech and growth names.

Longer-duration bonds rallied in Q4, while short-duration bonds provided stability throughout 2023

In fixed income, our allocations to longer-duration bonds aided our portfolios’ performance in Q4, as the Fed’s pivot toward interest rate cuts triggered a rally in bond markets. 

For 2023 as a whole, ERAA®'s overweight position on short-dated US Treasury bills (T-bills) in our lower and medium-risk portfolios were a steady source of support throughout the ups and downs of the past year given their combination of low risk and high yields.

Looking to the year ahead, once economic data show a clearer shift in the economic regime, that’s when ERAA® can further lengthen duration for our fixed income holdings. For more on bonds, check out CIO Insights: How you can navigate the bond market’s choppy waters.

Gold shone amid geopolitics, rate cut expectations, and a weaker US dollar

Our overweight allocations to gold – historically known to be a safe-haven asset – generated positive returns for our portfolios in both Q4 and 2023 as a whole. In the final quarter of the year, the asset class posted returns of 11.5% in USD terms, supported by a weaker USD and declining bond yields as investors priced in interest rate cuts and heightened geopolitical risks – trends that appear to be continuing into 2024. In 2023, the precious metal saw gains of 12.7% in USD terms.

General Investing portfolios powered by BlackRock

Our General Investing portfolios powered by BlackRock posted robust returns in Q4. They were up +9.2% on average in USD terms, just below their average benchmark returns of +9.3%.

For the full year, they showed double-digit returns on average, or  +15.4% in USD terms, versus average gains of +16.3% for their benchmarks.

For a detailed commentary on the latest re-optimisation by BlackRock, read here.

Responsible Investing portfolios

Our Responsible Investing (RI) portfolios, which optimise for both long-term returns and ESG impact, were aided by the year-end rally, but a more defensive positioning led to slightly lower returns relative to their same-risk benchmarks. 

In Q4, they were up +7.4% on average in USD terms. That compares with a +9.9% gain on average for their same-risk benchmarks.

For the year as a whole, they were up +12.1% on average, compared with a +15.3% gain on average for their same-risk benchmarks.

Thematic portfolios

The year-end rally benefited our Thematic portfolios, given their significant exposure to risk assets. That, paired with investor enthusiasm for the tech sector last year, contributed to double-digit gains for our Technology Enablers and Future of Consumer Tech portfolios. The risk-on rally also supported our Healthcare Innovation, and Environment and Cleantech portfolios, which ended the year with modest positive gains.

Technology Enablers

Our Technology Enablers portfolios posted positive returns of +13.3% on average in USD terms during Q4. For 2023, it posted gains of +31.4% on average in USD terms.

The portfolio benefitted from investor enthusiasm in the technology sector in 2023, with the AI, blockchain, and semiconductor sub-sectors as top gainers in the portfolio. Meanwhile, our balancing assets, short-term bonds and gold, also provided downside protection during drawdowns. This was particularly the case for lower-risk SRIs.

Future of Consumer Tech

Our Future of Consumer Tech portfolios also posted solid returns of +12.8% on average in USD terms during Q4. For 2023, it gained  +26.1% on average in USD terms.

Similar to Technology Enablers, our Future of Consumer Tech portfolio was also supported by the tech rally in Q4 and 2023. The strong recovery of digital banks and payments companies after the banking crisis in Q1 helped the fintech sub-sector be the portfolios’ main driver of performance, while electric vehicles and e-sports also supported returns. As with our Technology Enablers portfolio, defensive allocations to short-duration bonds and gold gave downside protection.

Healthcare Innovation

Our Healthcare Innovation portfolios benefitted from the year-end rally and posted gains of +10.5% on average in USD terms during Q4. For 2023, returns were more muted at +5.9% on average in USD terms.

The genomics sub-sector continued to be the main driver for the portfolio, while the health-tech and biotechnology sub-sectors regained ground in Q4. As with our other Thematic portfolios, balancing assets also contributed to portfolio returns – particularly among lower-risk SRIs.

Environment and Cleantech

Our Environment and Cleantech portfolios posted gains of +9.3% on average in USD terms during Q4. That brought full-year returns for these portfolios to +3.7% on average in USD terms.

Here, clean energy infrastructure, water and environmental services sub-sectors were the main drivers of the portfolios’ performance over the course of the year, while renewable energy stocks were detractors. Allocations to green bonds also positively contributed to returns. 


Our same-risk benchmarks are proxied by MSCI AC World Index (for equities) and FTSE World Government Bond Index (for bonds). The benchmarks we use have the same 10-years realised volatility as our portfolios.

Model portfolio returns are expressed in gross terms before fees, withholding taxes, and reclaims on dividends. They are provided only as a gauge of pure performance before other items.

Actual account returns may deviate from the model portfolios due to differences in the timing of trade execution (e.g. during the day vs close), timing differences and intraday volatility of reoptimisation and re-balancing, fees, dividend taxes and reclaims, etc. All returns are in SGD terms.

Past performance is not a guarantee for future returns. Before investing, investors should carefully consider investment objectives, risks, charges and expenses, and if need be, seek independent professional advice.

This communication is not and does not constitute or form part of any offer, recommendation, invitation or solicitation to purchase any financial product or subscribe or enter any transaction.

This communication does not take into account your personal circumstances, e.g. investment objectives, financial situation or particular needs, and shall not constitute financial advice. You should consult your own independent financial, accounting, tax, legal or other competent professional advisors.

This information should not be relied upon as investment advice, research, or a recommendation by BlackRock regarding (i) the iShares Funds, (ii) the use or suitability of the model portfolios or (iii) any security in particular. Only an investor and their financial advisor know enough about their circumstances to make an investment decision. Past Performance is not a reliable indicator of future results and should not be the sole factor of consideration when selecting a product or strategy.

For StashAway General Investing portfolios that are powered by BlackRock, BlackRock provides StashAway with non-binding asset allocation guidance. StashAway manages and provides these portfolios to you, meaning BlackRock does not provide any service or product to you, nor has BlackRock considered the suitability of its asset allocations against your individual needs, objectives, and risk tolerance. As such, the asset allocations that BlackRock provides do not constitute investment advice, or an offer to sell or buy any securities.

BlackRock® is a registered trademark of BlackRock, Inc. and its affiliates (“BlackRock”) and is used under license. BlackRock is not affiliated with StashAway and therefore makes no representations or warranties regarding the advisability of investing in any product or service offered by StashAway. BlackRock has no obligation or liability in connection with the operation, marketing, trading or sale of such product or service nor does BlackRock have any obligation or liability to any client or customer of StashAway.

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