Innova Aspiration Portfolio

May 2026

Performance Table

1MTH3MTH6MTH1YR3YR (PA)5YR (PA)INCEPTION (PA)
Innova Aspiration Portfolio2.80%0.49%2.88%10.94%9.82%6.73%6.85%
FE Peer Group Growth2.43%0.83%2.82%8.52%9.57%6.19%6.42%
Excess Returns0.37%-0.34%0.06%2.42%0.25%0.54%0.43%

Portfolio Performance

May saw a continued recovery in growth assets, with US equities delivering their strongest monthly performance since late 2023. Investor sentiment was supported by better-than-expected company earnings, continued enthusiasm around artificial intelligence (AI), and easing concerns around Middle East tensions. The S&P 500 rose around 5%, while technology and semiconductor companies continued to benefit from strong AI-related investment and earnings growth.

Markets reduced expectations for US interest rate cuts following resilient economic data, particularly a stronger-than-expected May payrolls report. The US economy added 172,000 jobs, well above forecasts, while revisions to prior months reinforced the view that labour market conditions remain robust. Inflation expectations also edged higher, causing government bond yields, particularly longer-term yields, to rise.

Oil prices declined as optimism grew around potential de-escalation in the Middle East and reduced risks to global energy supply, easing some inflation concerns. Fixed income markets came under pressure from rising bond yields, particularly longer-duration government bonds, while domestic floating-rate credit continued to perform well due to elevated cash rates.

Innova portfolios delivered positive returns across growth profiles in May, with higher-growth portfolios outperforming defensive ones, driven by strong global equity gains. Global equities were the main driver of performance, with active exposures outperforming benchmarks, while Australian equities also delivered modest gains.. Domestic floating rate credit continued to add value, supported by elevated cash rates. The Australian dollar strengthened over the month, while commodities weakened, led by declines in oil and gold prices. Overall, strong equity markets were the main driver of returns, while defensive and commodity exposures made a smaller contribution.

Asset Allocation Exposure

Breakdown pie chart
Global Shares49.27%
Australian Shares26.43%
Real Assets10.80%
Fixed Interest9.62%
Alternatives2.71%
Cash1.17%

Top Portfolio Holdings

Capital Group New Perspective Fund Hedged (AU)
10.64%
VanEck Vectors MSCI International Value ETF
9.15%
DNR Capital Aus Eq High Conviction SMA
9.06%
Schroders Equity Opportunities
8.46%
Franklin Global Systematic Equity Fund
7.28%
GQG Partners Emerging Markets Equity Fund
6.88%
Invesco Wholesale Australian Share Fund
5.95%
AB Global Strategic Core Equities Fund
5.86%
Macquarie True Index Global Infrastructure Securities Fund
5.62%
Quay Global Real Estate Fund
5.18%

Growth of $100,000 since inception

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5YR3YR1YR
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Market Outlook

Looking ahead, markets are being influenced by two competing forces: inflation remains resilient, while expectations for interest rate cuts have continued to fade. Markets are now pricing in very few US interest rate cuts for the rest of the year and into 2027, which is a significant change from earlier expectations. Higher energy prices have slowed the decline in inflation and are likely to keep the US Federal Reserve cautious before making any policy changes.

With the US midterm elections approaching, political pressure on the Federal Reserve is likely to increase. However, J.P. Morgan Global Research expect interest rates to remain unchanged for the remainder of 2026, as cutting rates too early could risk reigniting price pressures already running above the 2% target.

Investor enthusiasm for growth and technology companies also received a boost following SpaceX’s highly anticipated share market debut. The company raised US$75 billion at a valuation of US$1.75 trillion, with its share price rising 19% on its first day of trading. This has reinforced positive sentiment towards large technology companies, although the sustainability of this momentum will depend on how inflation evolves and the policy direction of the Federal Reserve under its new Chair, Kevin Warsh.

While economic conditions remain supportive overall, we continue to expect interest rates to stay higher for longer. As a result, portfolios remain positioned to balance opportunities in areas benefiting from strong equity market momentum, while also managing the risks associated with a more uncertain interest rate environment.

Investment Objective

The portfolio aims to provide a return exceeding the RBA Target Cash Rate +5% p.a., before fees, over rolling 10 year periods.

Key Information

Inception01/07/2018
Management Fee0.36%
Maximum Expected Volatility15.00%
Standard Risk MeasureHigh
BenchmarkRBA Cash Rate Target + 5.0%
Model CodeMACC000199
Investment Timeframe10 Years
PlatformNetwealth

About the Manager

Innova is a boutique portfolio management firm with institutional-grade capabilities that specialises in risk-focused portfolio solutions. Co-founded by Dan Miles and Dinyar Irani in 2010, Innova’s objective is to provide robust investment solutions that work with investor behaviour, rather than against it.

Innova has a comprehensive understanding of investment risk and has developed a proprietary risk management framework based on rigorous academic research to support their investment process. Their quantitative framework acts as the compass, with their experienced investment team determining the best approach to execute this outcome. Innova's systematic approach to portfolio construction has enabled them to navigate global markets successfully, even during challenging market cycles.

Innova has consistently adhered to their investment process across all market regimes. They have rigorously tested their process and analysed hundreds of historical data sources to ensure they always have conviction in their investment decision making. As a result, Innova is able to consistently manage portfolio risk during market downturns and their performance track record is a testament to the effectiveness of their approach.

Important Information

This document has been prepared by Innova Asset Management Pty Ltd (Innova), ABN 99 141 597 104, Corporate Authorised Representative of Innova Investment Management, AFSL 509578 for provision to Australian financial services (AFS) licensees and their representatives, and for other persons who are wholesale clients under section 761G of the Corporations Act.
To the extent that this document may contain financial product advice, it is general advice only as it does not take into account the objectives, financial situation or needs of any particular person. Further, any such general advice does not relate to any particular financial product and is not intended to influence any person in making a decision in relation to a particular financial product. No remuneration (including a commission) or other benefit is received by Innova or its associates in relation to any advice in this document apart from that which it would receive without giving such advice. No recommendation, opinion, offer, solicitation or advertisement to buy or sell any financial products or acquire any services of the type referred to or to adopt any particular investment strategy is made in this document to any person.
All investment involves risks, including possible delays in repayments and loss of income and principal invested. Any discussion of risks contained in this document with respect to any type of product or service should not be considered to be a disclosure of all risks or a complete discussion of the risks involved. Past performance information provided in this document is not indicative of future results and the illustrations are not intended to project or predict future investment returns.
The performance reporting in this document is a representation only. Innova has used a calculation methodology to simulate the performance of the relevant Investment Program since commencement, net of all fees and commissions at the fund/security level, and gross of other fees and commissions. Simulated performance does not reflect the performance of any specific account. Each account will have its own unique performance history, due to factors including varied methods of implementation, fee and tax structures. Therefore, simulated performance may vary significantly compared to that of any specific account. The out of sample backtested performance data has been simulated by Innova and is for illustrative purposed only, and is not representative of any investment or product, Results based on simulated performance results have certain inherent limitations as these results do not represent actual trading. No representation is being made that any account will or is likely to achieve profits or losses similar to those being shown.
Although non-Fund specific information has been prepared from sources believed to be reliable, we offer no guarantees as to its accuracy or completeness. Any performance figures are not promises of future performance and are not guaranteed. Opinions expressed are valid at the date this document was published and may change. All dollars are Australian dollars unless otherwise specified.

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