The Equitile Resilience Fund (UK-domiciled) aims to deliver capital growth by investing in large, growing companies in the developed markets. It is managed according to our core investment principles and uses the Equitile Fair Fee Model.
The Equitile Global Equity Fund (Ireland-domiciled ICAV) follows the same strategy and principles as the Equitile Resilience Fund. The lastest update and other documents can be found here.
The global economy and hence financial markets have been buffeted by a series of interconnected negative events during April. The tentative signs of a negotiated peace in Ukraine, which seemed possible last month, have come to nothing. Instead, positions on both sides have hardened with, worryingly, a growing risk of NATO or at least NATO members getting drawn into the conflict. In addition, large economically important parts of China have been placed under another lock down over fears of a resurgence of the Covid-19 virus. Both these events have come together to add additional upward pressure on global inflation. Europe’s attempts to decouple from Russian exports together with Ukraine’s diminished agricultural output are causing shortages in energy, metals and agricultural commodities. At the same time, China’s lockdown is causing supply disruption in finished goods. As a result, the global economy is suffering both input and output price inflation simultaneously with curtailed activity. In short, the world economy has, at least temporarily, turned stagflationary.
Against this backdrop we have made some adjustments to your portfolio by further increasing your exposure to the mining and energy sectors and trimming your investments in the semiconductor sectors. Anglo American, the diversified mining company is now your third largest investment.
Against the negative macroeconomic and geopolitical backdrop, equity markets and your portfolio valuations have declined during April. Nevertheless, the underlying businesses in which you are invested have continued progressing at a healthy rate. So far in the Q1 reporting season, 77% of portfolio holdings have exceed expectations with their financial performance. Q1 2022 average revenue growth currently stands at 17.9% year-on-year, which is still above the six year historic average for your fund. Portfolio constituents are also generally reporting that they are working well in partnership with their suppliers to outmanoeuvre input disruptions.