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.
The recovery from last year’s Covid lockdowns is gathering pace, lifting both stock markets and your fund higher during March. Post-pandemic fiscal stimulus plans and bottlenecks in supply chains were again the dominant themes this month.
President Biden’s $2Trillion+ American Jobs plan is ambitious both in its size and scope. We expect it to become a template for other governments around the world who will likely follow with similarly bold plans. Interestingly, the plan contains substantial support to domestic US manufacturing. We sense a significant shift of tone from policymakers away from emphasising the efficiencies of global integration towards the resilience offered by local manufacturing. This message has been further supported by the supply chain disruption caused by this month’s blockage of the Suez Canal by the ‘Ever Given’ container ship.
Aggressive fiscal stimulus in combination with the unwinding of globalisation is, in our view, a recipe for inflation. We suspect the 2020 COVID crisis will come to be seen as the turning point from a multi-decade disinflationary trend back toward a similarly extended period of inflation.
We consider your fund to be well positioned for this environment: your significant investments in semiconductor equipment suppliers should benefit both from the growing shortage of silicon chips and increased policy driven investment spending.