By 23 March, the S&P 500 had fallen 35% in just 18 days. Subsequently, a powerful rally set in, retracing around half of the fall. It remains to be seen whether the lows set in March will hold, it has been somewhat calmer over the past couple of weeks and volatility has sunk back.

Esk continued to seek out great long-term franchises as prices sank into late March. We were most excited with the opportunity to initiate a new position in Mastercard, which we bought on two occasions on 20 and 23 March. This was the period of greatest activity in the Fund’s portfolio, we bought back the Apple that we had sold in January and added further to the holding in Intuit. Lastly, we sold the small holding in General Motors in favour of increasing the position in Uber Technologies. There were no transactions after 23 March.

Looking around the rest of the portfolio, we are pleased to have been significantly under-weight in oil stocks though the two holdings that we own, Total and Phillips 66, have suffered significant falls. Financials continue to be a drag on the portfolio, notably the banks. We are not tempted to increase weightings in either of these areas at present. The overweight in pharmaceuticals is benefitting the Fund, the new holding in M3 Inc being something of a star turn, with strong performance also from Lonza Group, Johnson & Johnson and Roche Holding.

Clearly, the portfolio is also benefitting from some of the core technology related holdings, notably Amazon and Microsoft, along with good steady performance from some of the staple goods companies such as Nestlé, Mondelēz and Monster Beverage. We expect the markets to look through the current crisis in a steadily more rational manner over the next few months, increasingly looking to what will have changed on a more permanent basis. In the short-term, we really do not know whether markets will move back down to re-test the lows, they could easily do so, we will continue to seek opportunities in good quality companies.