Executive summary:

• As the Iran War triggered a broad sell-off, Syfe portfolios held steady or outperformed their benchmarks
• Diversification was a strength for our Core portfolios, with our broad positioning beyond megacaps reinforcing resilience
• Both Income+ and REIT+ held up well against the backdrop of the equity sell-off. Both now offer attractive yields and compelling entry points for the recovery
• Markets are set to return to fundamentals, and the theme of “dispersion” will likely continue, setting the stage for a more selective approach championed by our newest portfolio: Equity Alpha

Market Review

The first quarter was dominated by the war in Iran. A historic energy shock sent global markets trembling. As oil drew close to $120 per barrel, equities sold off worldwide. Energy-dependent Asian markets like Japan and Korea suffered double-digit drops, exposing their reliance on energy flows through the Strait of Hormuz, the waterway responsible for roughly 20% of the world’s seaborne oil and liquified natural gas (LNG). There were few places to hide other than the US dollar.

In the face of the across-the-board sell-off, Syfe’s managed portfolios remained resilient. As you shall see in more detail, the majority of our Core portfolios outperformed their benchmarks this quarter. High payouts from Income+ and REIT+ portfolios, which held steady compared to equities, provided a valuable anchor for multi-asset allocations at the height of the volatility. In February, we launched Equity Alpha, powered by J.P. Morgan Asset Management, built for active and selective investing in an increasingly dispersed market, offering our clients more choices to navigate an uncertain world.

Through March, we urged investors to stay invested, noting that markets have detached from fundamentals. Sectors with strong earnings were severely sold off (e.g. technology) while those with modest gains benefitted the most (e.g. energy). This dislocation created attractive entry points in equities. Fixed income yields also reached compelling levels, opening a compelling window to capture additional income before interest rates ease later in the cycle.

Clients who followed our advice were able to navigate through the market volatility much more effectively. Good days can happen in bad markets. It is practically impossible to time those days precisely. A better strategy is to stay invested and dollar cost average (DCA). The S&P 500 has recovered all its losses since the start of the war and broken new record highs by early April.

The market rebound reinforces our conviction. Fundamentals are strong. Q1 US earnings are expected to expand 12%, which would mark the sixth straight quarter of double-digit growth. Themes like artificial intelligence and energy independence will continue to give impetus for growth, though these trends will produce both winners and losers, making selection important in the months ahead.

Key Portfolio Highlights:

• Core Portfolios: Resilience in Volatile Times
• Income Portfolios: Positioning for Disinflation
• REIT Portfolios: Getting Paid to Wait
• Thematic Portfolios: Long-Term Conviction

Core Portfolios: Resilience in Volatile Times

Performance Spotlight

• Confronting challenging global markets, three of the four Core portfolios outperformed their benchmarks this quarter, supported by diversification across asset classes and geographies. Equity100 (SRS) recorded almost 70 basis points of outperformance, while Core Defensive was more than 50 basis points ahead of the benchmark.
  
• International developed markets contributed positively — Australia, Canada, and Europe to a smaller extent were better positioned given energy independence and diversified energy sources. Emerging markets were flat. China detracted mildly due to regulatory headwinds and profit-taking. We continue to believe in China’s long-term potential and that it remains under-represented in global benchmarks.
  
• Our largest regional exposure, the US, beat the broader market (-1.5% vs S&P 500 -4.2%). Our tilt towards small and mid-cap value captured the rally in energy and materials, while our equal-weighted exposure added stability as growth broadened beyond tech megacaps.
  
• Gold was the single biggest positive contributor across all three multi-asset portfolios, adding +1.05% to Defensive, +0.83% to Balanced, and +0.41% to Growth. Bonds held firm, anchoring Core Defensive and Core Balanced, where they represent roughly half the allocation.

Looking Ahead

Syfe’s Core portfolios are well-positioned for the quarters ahead as fear subsides and markets refocus on fundamentals, with broad US equity exposure, international allocations that delivered even through the war, and a multi-asset foundation in gold and bonds.

These broad portfolios enable you to keep Dollar Cost Averaging (DCA) or lean in on Enhanced DCA – investing more than usual in significant corrections – to capture the more upside in the recovery.

New Portfolio: Equity Alpha, an Active Choice for the Year of Selection 

• One key change this year is that the gap between winners and losers is widening, driven by forces ranging from technological to energy disruptions. Within AI, for example, hardware topped software, and companies with greater capex discipline did better.
  
• Our newest portfolio, Equity Alpha, is designed to capture this “dispersion” through a selective approach – with small tilts on a large number of stocks.
  
• Built with J.P. Morgan’s Research Enhanced Index (REI) ETFs, which have a 20-year track record, the strategy has generated 11.4% annualised returns over the last eight years. We expect the portfolio to benefit later in the year as this theme further unfolds. 
• From now until 15th May 2026, earn additional cash and rewards when you invest in Equity Alpha. A smarter way to go active. Start today.

Income Portfolios: Positioning for Disinflation

Performance Spotlight

• Global bonds navigated a rollercoaster quarter as inflation fears disrupted the easing cycle, pushing yields sharply higher and credit spreads wider. Traders rapidly pared back the probability of the US Federal Reserve cutting interest rates and even began pricing in hikes in Europe and the UK.
  
• Despite the drawdown, both portfolios held up significantly better than equities, demonstrating the defensive role they play in a multi-asset allocation. Income+ Preserve returned -1.7% and Income+ Enhance -1.5%, with much of the fall concentrated in March.
  
• In a market repricing rate expectations, Income+ portfolios continue to offer attractive, high-quality income with built-in flexibility to capture the recovery as disinflationary forces reassert themselves.

Looking Ahead

• We continue to see disinflationary forces building in the US economy, especially with productivity gains from AI. Markets are beginning to reassess inflation risks as a de-escalation scenario in the Middle East takes shape.
  
• Income+ portfolios are well-positioned to capture any subsequent recovery. Starting yields are among the strongest predictors of forward returns in bonds. Yields-to-maturity have now reached 6.0% for Preserve and 6.4% for Enhance — a strong foundation for future total returns.
  
• Powered by PIMCO’s active management, the portfolios maintain the flexibility to adjust positioning as conditions evolve — capturing opportunities when markets rebound while keeping downside risks in check.

REIT+ Portfolios: Getting Paid to Wait

• S-REITs had a strong start before the Iran War reversed sentiment in March. The sell-off was driven by macro repricing, not deteriorating fundamentals. Grade A office rents grew 0.8%, retail rents rose 0.5%, and vacancy rates continued to tighten.
  
• Both REIT+ portfolios outperformed their benchmark. REIT with Risk Management limited losses to -4.18%, demonstrating the value of its defensive overlay. Keppel DC REIT, our largest holding, was the standout – supported by structural data centre demand and the ability to pass through higher energy costs.

Looking Ahead

• S-REITs are now trading at about 0.93x forward book value, below their historical mean. At these levels, investors are being paid to wait for a return to fundamentals — and to own high-quality Singapore real estate at an attractive entry point.
  
• As rate cut expectations rebuild and fundamentals remain intact, S-REITs offer both attractive income and potential capital upside. Our REIT+ portfolios remain well-positioned for investors seeking reliable SGD-denominated income without FX risk.

Thematic Portfolios: Long-Term Conviction

• Three of four thematic portfolios outperformed in a tricky quarter for growth investing. ESG & Clean Energy was the standout at +2.83%, as surging oil prices and energy security concerns accelerated demand for renewables and battery storage – validating our pivot toward energy security themes in December’s rebalance.
  
• China Growth (-3.95%) was comfortably ahead of MSCI China (-8.8%), supported by our tilt toward onshore A-shares and clean technology. Dealing with deflation rather than inflation, and with strategic oil reserves, China entered the crisis in a fundamentally different position to most major economies.
  
• Disruptive Technology (-5.2%) and Healthcare Innovation (-6%) felt the impact of rates repricing on longer-duration growth stocks, though both outperformed or matched their reference indices. The underlying theses – AI infrastructure buildout, semiconductor demand, healthcare automation, and the robotics opportunity driven by demographics and AI capability – remain intact and are reinforced by acceleration in adoption.

What’s Next? Our Thoughts on the Coming Quarters

This tumultuous quarter in risk assets was followed by a decisive rebound in early April, which validated our conviction that markets eventually return to fundamentals – and that they won’t wait for full resolution to do so. Ultimately, they will focus on the themes that matter in the future, and not today’s headlines.

Our portfolios are now poised to capture that recovery, with diversified exposures across geographies, asset classes, and sources of return – from factor-based Core allocations to thoughtful stock selection in Equity Alpha. We will remain focused on growing wealth for our clients that is built to last.

Thank you for your continued trust in Syfe. As always, we remain committed to managing your portfolios with discipline, transparency, and a long‑term perspective.