Global equities continued the positive start to the year in February, led by the ongoing rotation out of US large cap technology into other sectors and regions across the developed and emerging markets. Global fixed income markets were also positive as yields generally declined, with UK gilts outperforming on easing inflationary pressures and falling interest rate expectations. Trading highlights for February:
UK Equities: Two new holdings, Diploma and Mitie Group were added during the month. Diploma is a leading global distributor of industrial products, while Mitie is the UK’s largest provider of facilities management services. While operating in very different fields, both companies provide essential products and services to a diverse base of customers, are market leaders in consolidating industries, and have well-articulated strategies to deliver sustainable growth in earnings.
International Equities
International Equities enjoyed a strong month, benefiting from broad regional and sector diversification as Asia Pacific (L&G Pacific Index Trust +14.1%), Emerging Markets (JP Morgan Emerging Markets Income +9.1%), Europe (Waverton European Capital Growth +7.7%) and Japan (Pictet Japanese Equity Opportunities +11.8%) all reported significant gains. Diversification within the US equity allocation was also beneficial, as the Funds’ active strategies (BNY Mellon US Equity Income +5.4%, T. Rowe Price US Smaller Companies +5.4%, Findlay Park American +5.2%) outperformed US stock market benchmarks (Vanguard US Equity Index Fund +1.5%).
UK Equities
The Funds’ direct UK Equities performed well overall in February, led by double-digit gains from Cairn Homes (+15.9%), AstraZeneca (+15.5%), Ashtead (+14.6%), Tesco (+13.0%), National Grid (+12.7%), Convatec (+11.5%) and Shell (+11.0%). The threat of AI disruption remains a key source of stock and sector-level volatility, with negative sentiment towards the digital media sector (Trainline -4.5%, Autotrader -8.4%, Future -23.3%) the main source of weakness over the month.
Fixed Interest
Fixed Interest delivered solid positive total returns across both government bonds and credit, with the more rate-sensitive direct UK gilt holdings generally delivering the strongest returns. The Funds’ fixed income allocation remains focused on generating attractive cash yields from short tenor lending to the investment grade corporate bond market, with relatively low sensitivity to changes in long-term government bond yields.
Alternative Assets
‘‘Alternative’ assets made another pleasing contribution to portfolio returns as the defensive, high-quality long- term income streams of real assets (infrastructure, real estate) continued to come back into favour with investors. The strongest performers were infrastructure funds International Public Partnerships (+7.3%) and HICL Infrastructure (+6.0%) and UK real estate investment trusts LondonMetric Property (+7.6%) and Supermarket Income REIT (+6.4%).
Contact us
0203 418 0257
info@onekc.co.uk
References
Source: https://www.brooksmacdonald.com/resources/insights/cornelian-risk-managed-funds-monthly-update
Cornelian Risk Managed Funds – Monthly update
Global equities continued the positive start to the year in February, led by the ongoing rotation out of US large cap technology into other sectors and regions across the developed and emerging markets. Global fixed income markets were also positive as yields generally declined, with UK gilts outperforming on easing inflationary pressures and falling interest rate expectations. Trading highlights for February:
UK Equities: Two new holdings, Diploma and Mitie Group were added during the month. Diploma is a leading global distributor of industrial products, while Mitie is the UK’s largest provider of facilities management services. While operating in very different fields, both companies provide essential products and services to a diverse base of customers, are market leaders in consolidating industries, and have well-articulated strategies to deliver sustainable growth in earnings.
International Equities
International Equities enjoyed a strong month, benefiting from broad regional and sector diversification as Asia Pacific (L&G Pacific Index Trust +14.1%), Emerging Markets (JP Morgan Emerging Markets Income +9.1%), Europe (Waverton European Capital Growth +7.7%) and Japan (Pictet Japanese Equity Opportunities +11.8%) all reported significant gains. Diversification within the US equity allocation was also beneficial, as the Funds’ active strategies (BNY Mellon US Equity Income +5.4%, T. Rowe Price US Smaller Companies +5.4%, Findlay Park American +5.2%) outperformed US stock market benchmarks (Vanguard US Equity Index Fund +1.5%).
UK Equities
The Funds’ direct UK Equities performed well overall in February, led by double-digit gains from Cairn Homes (+15.9%), AstraZeneca (+15.5%), Ashtead (+14.6%), Tesco (+13.0%), National Grid (+12.7%), Convatec (+11.5%) and Shell (+11.0%). The threat of AI disruption remains a key source of stock and sector-level volatility, with negative sentiment towards the digital media sector (Trainline -4.5%, Autotrader -8.4%, Future -23.3%) the main source of weakness over the month.
Fixed Interest
Fixed Interest delivered solid positive total returns across both government bonds and credit, with the more rate-sensitive direct UK gilt holdings generally delivering the strongest returns. The Funds’ fixed income allocation remains focused on generating attractive cash yields from short tenor lending to the investment grade corporate bond market, with relatively low sensitivity to changes in long-term government bond yields.
Alternative Assets
‘‘Alternative’ assets made another pleasing contribution to portfolio returns as the defensive, high-quality long- term income streams of real assets (infrastructure, real estate) continued to come back into favour with investors. The strongest performers were infrastructure funds International Public Partnerships (+7.3%) and HICL Infrastructure (+6.0%) and UK real estate investment trusts LondonMetric Property (+7.6%) and Supermarket Income REIT (+6.4%).
Contact us
0203 418 0257
info@onekc.co.uk
References
Source: https://www.brooksmacdonald.com/resources/insights/cornelian-risk-managed-funds-monthly-update
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