LCI Annual Strategy Review December 2022
Performance Overview
2022 was one of the worst years on record for diversified portfolios: a rate-and-inflation shock drove equities and bonds down together, so fixed income failed to cushion the equity losses as it normally would. All 18 LCI strategies finished the 12 months in the red, ranging from -6.9% (Growth EUR SE) to -14.3% (Growth CHF S). The headline story, however, is relative: every single strategy beat its benchmark over the year — by between +1.2% and +11.3% — as LCI’s lower-duration bond stance, a gold/real-asset cushion in the active-enhanced sleeves, and a handful of EM equity winners softened the drawdown that hit the rate-heavy benchmarks much harder.
Performance - 2025
Semi-Passive (S) | Active-Enhanced (SE)
| Semi-Passive (S) | Active-Enhanced (SE) | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Strategy | 12M | vs Bench | p.a. SI | vs Bench SI | Strategy | 12M | vs Bench | p.a. SI | vs Bench SI | |
| LCI Yield CHF S | +4.71% | -117 bps | +2.28% | +145 bps | LCI Yield CHF SE | +7.81% | +193 bps | +3.66% | +283 bps | |
| LCI Balanced CHF S | +7.70% | +121 bps | +4.37% | +250 bps | LCI Balanced CHF SE | +10.09% | +359 bps | +5.35% | +348 bps | |
| LCI Growth CHF S | +10.72% | +54 bps | +6.42% | +324 bps | LCI Growth CHF SE | +12.38% | +219 bps | +7.02% | +384 bps | |
| LCI Yield EUR S | +4.79% | -330 bps | +3.74% | +180 bps | LCI Yield EUR SE | +7.67% | -42 bps | +4.97% | +303 bps | |
| LCI Balanced EUR S | +7.58% | -53 bps | +5.99% | +287 bps | LCI Balanced EUR SE | +9.79% | +168 bps | +6.79% | +367 bps | |
| LCI Growth EUR S | +10.38% | -206 bps | +8.21% | +392 bps | LCI Growth EUR SE | +11.91% | -53 bps | +8.60% | +431 bps | |
| LCI Yield USD S | +13.23% | +284 bps | +5.45% | +136 bps | LCI Yield USD SE | +16.44% | +605 bps | +6.60% | +252 bps | |
| LCI Balanced USD S | +18.06% | +464 bps | +7.65% | +249 bps | LCI Balanced USD SE | +20.21% | +680 bps | +8.39% | +323 bps | |
| LCI Growth USD S | +23.04% | +896 bps | +9.79% | +315 bps | LCI Growth USD SE | +24.07% | +999 bps | +10.14% | +349 bps | |
Returns in reference currency; SI = since inception (annualised). Positive figures in green, negative in red. Source: La Côte Invest.
Since-Inception Cushions
Despite the 2022 setback, all 18 strategies remained ahead of their benchmarks on an annualised since-inception basis (Jan 2016 launch, 84 months). The relative cushion ranges from +1.2% p.a. (Yield USD S) to +4.6% p.a. (Growth EUR SE), with the active-enhanced (SE) sleeves consistently ahead of their semi-passive (S) twins. The EUR Growth and EUR Balanced families carry the widest annualised edge.
Best and Worst Contributors
(Sub-asset-class level, direction averaged across strategies; contribution varies widely by sleeve.)
Best contributors: the alternatives cushion (gold) and the small Latin American equity sleeve were the only net-positive contributors on average — and only in the sleeves that actually held them; everything else simply detracted less.
Worst contributors: North American equity was the single biggest drag, followed by the investment-grade and government bond blocks as yields surged.
Best and Worst Performers
(Security level, 12M compounded return in each strategy’s reference currency; expired/zero-weight lines excluded.)
Best performers: iShares MSCI Brazil ETF was the standout, up roughly +13% to +20% depending on reference currency, followed by the Amundi MSCI Indonesia ETF (~+4% to +10%) and the hedged global real-estate funds. Commodity-linked and Latin American exposure were the rare winners.
Worst performers: Amundi MSCI Korea ETF was the weakest position at about -27.3%, with the USD EM Sovereign bond ETF (-21.5%) and the CHF-hedged S&P 500 ETF (-21.1%) close behind — a clean illustration of how both growth equity and rate-sensitive bonds were punished simultaneously.
FX Impact
Currency effects split sharply by reference currency. CHF sleeves were hurt by Swiss-franc strength (roughly -0.3% to -1.1%), with JPY and EUR weakness the main drags. EUR sleeves enjoyed the largest tailwind (about +1.5% to +2.7%), driven almost entirely by USD strength against a weak euro. USD sleeves saw a modest drag (around -0.5% to -2.0%) as EUR, JPY and GBP all depreciated against the dollar. Net, the dollar’s 2022 strength was a headwind for USD-based investors and a benefit for EUR-based ones.
Portfolio Changes
No material changes at the sub-asset-class level over the 12 months — strategic allocations were held steady throughout 2022. Activity was confined to security-level switches within sub-classes (rotating individual ETFs and funds), so headline asset-class and sub-asset-class weights at December 2022 matched December 2021.
Editorial Note
2022 was a year to lose less, and the portfolios did exactly that: holding strategic weights steady, leaning on a lower-duration bond stance and the gold/real-asset cushion, and letting a few EM equity positions provide the only genuine upside. The result — every sleeve ahead of benchmark and all still ahead since inception — validates the defensive construction rather than any tactical heroics. Worth watching from here: whether the rebuilt bond yields now restore fixed income’s diversifying role after a year in which it failed.
