President Trump announced a temporary row-back of his ‘liberation day’ tariffs to give time for unilateral trade deals to be put in place. Despite considerable uncertainty over the medium-term outlook for tariffs, investors took heart and bid risk assets higher. Interestingly, this resurgence in confidence did not translate into US dollar strength, nor longer-dated US Treasury price strength – a possible warning sign that the recent relief rally may not persist.

The Funds’ strongest performing asset class was international equities and despite the weaker US dollar, the L&G Global Technology Index Fund and the Artemis US Select Fund produced sparkling returns for UK based investors. 

The Funds’ portfolio of alternative assets continues to perform well with commercial property leading the way. LondonMetric Property and Supermarket Income REIT stood out. There are unequivocal signs that rental and valuation growth have returned to most sectors of UK real estate. 

The Funds’ concentrated portfolio of UK stocks produced, in aggregate, a positive return but lagged the benchmark somewhat. Whilst Balfour Beatty, Convatec and Cairn Homes all produced double digit returns on the back of positive trading updates, Auto Trader and Trainline underperformed on stock specific issues, which we believe will prove to be temporary. 

Hilton Food Group was added during May. The company produces high-quality packaged meat, seafood, meat alternatives and pre-prepared food products, at scale. They operate in long-term partnerships with leading international retailers and foodservice brands. The business has significant opportunities for growth, which it can finance from internally generated cash.

The Funds’ fixed income holdings outperformed a weak market, helped in no small part by the Funds’ specialist credit holdings.

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References

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