Summary

• The Ashburton Global Strategy Fund posted a strong return for April, although a large component of this was generated in the last week of March (but that had not been captured in the last March pricing).  This is a continuation of the distortion effects of the weekly pricing process of the Fund that had been exacerbated by the extreme market volatility.  

• The underlying funds have participated satisfactorily in the market recovery, in line with expectations.  Following the strong market rally, we sold some of the equity exposure towards the end of the month, taking some profits and bringing the asset allocation back in line with the TAA.  No further asset allocation or manager changes had been made during the month.

• The NAV on NAV movement for the Ashburton Global Strategy Fund, measured from the price struck on 25 of March to the price struck on 29 of April, was +15.5%.  

• In the Ashburton Global Strategy Fund, the Tactical Asset Allocation (TAA) to risk assets remain underweight compared to the long-term Strategic Asset Allocation, and overweight alternatives and cash.  No changes had been made during the month to the TAA.    

• Global markets rebounded strongly in April 2020, clawing back a large portion of the losses posted during March, despite macroeconomic data that started to reflect the massive economic cost of the worldwide shutdowns to curb the COVID-19 pandemic.  The rally in risk assets was driven by some positive sentiment returning to markets, as governments and central banks announced significant stimulus measures. 
  
• Developed markets outperformed emerging markets by a small margin, with the MSCI World Index returning 10.9%, compared to the MSCI Emerging Markets Index returning 9.2%.  Growth stocks continued to outperform value stocks.  Global REITs returned over 7% for the month.    

• The US Fed noted the “considerable risks to the economic outlook over the medium term.”  Bond markets rallied as central banks committed to purchase more government and corporate bonds, with the Barclays Global Aggregate Bond Index ending April, up 2%.    

• With economic data remaining weak, and a flare-up of US-China trade tensions, we believe that markets will remain volatile for the foreseeable future and are retaining a cautious positioning. 

• The asset allocation continues to reflect the current Ashburton macro-economic house view positioning.