Performance Review
Please see the table above for full details.
- Modest Returns of +0.2% for the UK stock market (as measured
by the FTSE All Share) as it struggled again as 10 year yields
rose above 4% again on second thoughts about the timing &
extent of rate cuts.
- Compound Income Portfolio saw a total return of +0.7%,
leaving ahead of the FTSE All Share Index over all shorter
term time periods up to a year, which is welcome after a tough
couple of years.
- Returns behind the FTSE All Share over 2 & 3 years but
still ahead significantly over 5 & 8+ years since
inception.
Portfolio Review
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- Another positive month & ahead of the market again
- Top contributions came again from the recent
purchase,Nexteq, while Kitwave had a good run into & over
their full year results. While Cake Box rose on no news &
provided some sweet returns..
- Oil & Gas stock Serica Energy struggled again post
results & associated large downgrades, while Paypoint gave
back some of last months gains & Ultimate Product drifted
due to a mixed in line update.
- There were 2 sales & 2 purchases in February.
Subscribers can see details of these in the Portfolio and
transactions sheets.
Summary & Conclusion
- A poor start to the year for UK equities, following the
year end rally, as bonds yields backed up as investors seemed
less certain that Central Banks will start cutting rates soon.
- US economy remaining robust & falls in inflation are
appearing and US equities remain firm, hitting new highs. This
was led by tech stocks in the main, despite some expected
delays in the onset of rate cuts.
- UK Equities, lagged other markets and therefore still look
unloved and offer excellent value versus their history. Very
happy with the CISP on around a 11x PE with a 4.4% yield
on average.
Outlook
It is always tricky forecasting, especially about the
future! Nevertheless we know we face elections in the US &
UK and will probably see interest rate reductions at some point
as inflation continues to slow.
Beyond that one would expect that we might see more breadth in
Stock Markets against that background, which, if it happens,
should benefit mid & small cap names more and the CISP (as
we have seen YTD) which is overweight in those areas. More
volatility seems likely too, with some sort of set back to the
recent narrow run up in the US seeming possible at some point or
not as the case may be.