Wealth managers had plenty of macro noise to contend with in the first half of the year.
In the UK, Brexit negotiations were temporarily put on hold following Theresa May's surprise decision to call a snap election, which ultimately backfired in a hung parliament. The political uncertainty in the first half predictably sent the pound on a rollercoaster ride.
Meanwhile the unpredictability of new US president Donald Trump also gave cause for concern.
Inflation and US interest rate hikes were among the other things investment managers were factoring in as they constructed their wealth portfolios.
Risk assets generally ignored the political noise though, with the Dow and S&P 500 notching their best first-half performance since 2013 with gains of 8% and 8.2% respectively. The FTSE 100 rose by a more modest 2.4% in the first six months of the year compared to the mid cap and AIM markets, which jumped by 7% and 14% respectively.
While wealth managers had been expressing concern over valuations at the end of last year feeling the bull run was running out of legs, initial performance estimates from Asset Risks Consultants (ARC) suggest they made sure they kept enough risk on the table.
At the end of June all four of ARC's private client indices were sitting in positive territory for the year.
The higher risk Sterling Equity Risk and Sterling Steady Growth indices were up 5.5% and 4.5% respectively, while the lower octane Balanced Asset and Cautious indices were up 3.2% and 1.9%.
This is despite a tough June, where the four benchmarks lost between 0.6% and 0.8%.
'June proved a more challenging month for investors across all currencies and risk ranges,' ARC commented as it released its latest update.
'The focus turned to central banks and the prospect of scaling back monetary stimulus led to a fall in global government bond markets, followed by equity markets coming off record highs.
'Market falls in the latter half of the final day of the quarter may adversely impact portfolio returns by between 50 and 100 bps depending on the portfolio valuation policy.'
Despite the slip up last month, wealth managers are on course to register another positive annual return after a strong 2016 (see table below).
Over 10 years the Equity Risk and Steady Growth indices have returned 69.3% and 61.8% respectively, while Balanced Asset and Cautious have returned 52.7% and 43% respectively.
However, with plenty of uncertainty still out there wealth managers could find it tough to keep portfolios in the black for the remainder of the years.
Heartwood Investment Management believes that while the global blackdrop remains supportive, there are still plenty of hurdles to clear.
'While the global backdrop remains supportive, we continue to face a number of hurdles: the withdrawal of global central bank liquidity; the ability of the newly elected UK government to deliver a positive Brexit outcome; and policy responses to the large structural economic challenges, such as ageing populations and the impact of technology,' Heartwood chief investment officer Noland Carter highlighted in his mid-year update.
Meanwhile Tilney chief investment officer Chris Godding believes monetary policy will remain accommodative across the globe despite a more hawkish tone from central banks.
A cautious approach in anticipation of rate rise could be a dangerous strategy Godding warned. 'Equity markets have been frustratingly defiant to everyone sitting on the side-lines waiting for a correction. The argument for caution is that high equity market valuations at a point where interest rates are poised to rise is a dangerous combination in anybody’s language.'