March was a difficult time for returns as all major equity regions and fixed income markets produced negative returns (in Sterling terms) as investors began to lose confidence in the new US administration’s policy making.

Within this context, it was good to see the Funds’ diversifying ‘real assets’ exposure in commercial real estate and infrastructure produce positive returns. Care Real Estate Investment Trust (REIT) was the standout performer as it received a takeover approach from a US firm which specialises in care home investment. Assura, the medical centres’ owner, continued to perform well after receiving two takeover approaches. Takeover activity elsewhere in the infrastructure sector buoyed the share prices of HICL and Foresight Environmental Infrastructure.

Mergers and acquisitions activity within REITs and infrastructure has increased markedly and this indicates that third party investors think that these segments are now exhibiting exceptional value – a view we wholeheartedly agree with.

The Funds’ international equity holdings outperformed the index, in aggregate. The US stock market had a particularly torrid time and the Funds’ US holdings were not immune to this. However, European markets held up better and it was good to see the Waverton European Capital Growth fund continue to perform strongly relative to its benchmark.

Within UK equities, Prudential (which we moved from a half weight to a full weight earlier this year) produced a good set of numbers but, more importantly, the Chief Executive Officer and Chief Financial Officer expressed confidence that they had reached an inflection point in terms of cash generation, which they now believe will accelerate strongly in the coming years. The evidence they gave to back this view was granular and informative and was taken well by investors.

Trading activity during March remained subdued.

Contact us

0203 418 0257

info@onekc.co.uk

References

Source: https://www.brooksmacdonald.com/individuals/resources/insights/cornelian-risk-managed-funds