The Equitile Resilience Fund 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.
Latest Overview GBP - July 2020 (print version)
On the last trading day of July, the market’s valuation of Apple increased by $171 billion, sufficient to buy all of Ford, General Electric and BP and with enough spare change to buy Rolls Royce (the aero engine company, not the cars) three times over. This underlines the extraordinary pace at which markets are shifting their relative valuations of the old ‘physical economy’ vs the new ‘virtual economy’. We believe these valuation shifts are justified by the movement to remote working/living which has been accelerated by the COVID19 lockdown. As we discuss in Luddites and the New Social Revolution, the lockdown has now gone on for long enough, and the remote working experiment has been successful enough, to produce irreversible social and economic change. The good news is that these changes will likely improve our long-term productivity, reduce our environmental impact and improve our work life balance. The bad news is, in the near term, the pace of economic adjustment within many of the largest employment sectors – travel, tourism and hospitality – is likely to cause a significant recession and a durable unemployment problem. We believe the lockdown, and the ongoing threat of second-wave lockdowns has now lasted too long to allow the quick V-shaped recovery we thought possible just a few months ago.
We believe your portfolio of investments remains well positioned to benefit from these economic changes. Nevertheless, during the month, we have adjusted your holdings, reducing your exposure to some medical suppliers and while adding to investments in online entertainment.