Global Strategy Fund: July 2021

Summary

• Global equity markets had another strong month, as economic data was positive due to developed market’s reopening and a positive sentiment as COVID-19 vaccines are being rolled out.
• Value stocks once again performed better than growth stocks in June, continuing the positive trend since the start of the year. 
• Global equities, as measured by the FTSE World Total Return Index returned 1.2% for the month.
• It was a negative month for global bonds, which have been under pressure this year, with government bonds (as measured by the FTSE WorldBIG Index) ending the month with a return of -0.7%.
• The Ashburton Global Strategy Fund priced for the month of June, returned -0.94% between 26 May ‘21 and 30 June ‘21.
• The largest contributor to performance over this period was the Mundane World Leaders Fund, which returned 1.0% as Amazon (which makes up a large portion of the portfolio), returned a healthy 6.7% for the month.
• The deep value equity manager, Lyrical, and core equity manager Epoch ended in the red with returns of -3.7% and -0.9% respectively, underperforming the FTSE All-World Equity Index.  For Epoch, the overweight Utilities and underweight Technology sectors (with Technology being the best performing sector for June), hurt performance.
• During the last few weeks of June, the gold price experienced its largest drop in 5 months after the US Fed made mention of increasing interest rates sooner than anticipated. Although the Ashburton Global Strategy Fund only holds a small exposure to the commodity, it was a further detractor.
• Global bonds produced a negative performance in June, resulting in Colchester Global Bond Fund to return -1.1%.
• The Franklin Templeton Global Total Return Fund remains low duration and also had a negative performance of -1.2% for the month.
• The negative return for June reversed some of the strong gains made in May.  Although the fund underperformed the SAA for the month of June, the Ashburton Global Strategy Fund is still ahead of its SAA over the first half of 2021.
• The Ashburton Global Strategy Fund reflects the macroeconomic house view of Ashburton Investments and post the implementation of the new Strategic Asset Allocation in January 2021, there have been no changes made from a tactical asset allocation perspective.