Little did we know what Mr Trump had in store for us and what a few months lay ahead for global markets. Placid (complacent) positive markets led by US Tech giants have given way to volatility not seen since the early months of COVID and, before that, the Financial Crisis of 2008. This is no small market “correction” and, at the time of writing, the ingredients for a recovery are not yet in place. As ever in difficult times it is important to be invested in quality companies with decent balance sheets, these are the ones that get through OK.

The Fund generated a negative return over the period albeit this was less bad than the falls seen in most major global indices. We benefitted from our relative underweight position in both the US and the Technology sector during the sell-off seen this year. On the other hand, our exposure to Financial, Healthcare and Consumer names was beneficial in these more defensive markets. Our sector positioning heading into early-2025 was driven by our belief that Big Tech was expensive and that there was better value elsewhere rather than a macro call made against the Tech sector.

Our top performers over the period were Financials, such as Euronext (London Stock Exchange’s French-listed peer), Swiss RE (reinsurance) and Standard Chartered (bank), while we also saw Swiss giants Nestlé and Roche (pharmaceuticals) recover after an extended period of weakness. Notable mention also goes to RELX, the Anglo-Dutch publishing and data analytics powerhouse, which is knocking on the door of being a top five position within Esk after an excellent decade for both the shares and the underlying business.

Our main detractors, particularly more recently, have been in Technology names Oracle, Microsoft and Alphabet (Google’s parent company). We have also seen ongoing weakness in T Rowe Price (asset management) shares. It is also worth noting the heightened volatility in our Japanese holdings – these predominantly export-led businesses have understandably been at the mercy (short-term) of US tariff fluctuations.

Overall, we are satisfied that the Fund has performed as we would expect it to have done in a US Tech-driven market sell-off and shown its defensive qualities in trickier times. We will remain vigilant in always investing in only the highest quality businesses and be on the lookout for opportunities in volatile markets.
 

The above article has been prepared for investment professionals. Any other readers should note this content does not constitute advice or a solicitation to buy, sell, or hold any investment. We strongly recommend speaking to an investment adviser before taking any action based on the information contained in this article.

Please also note the value of investments and the income you get from them may fall as well as rise, and there is no certainty that you will get back the amount of your original investment. You should also be aware that past performance may not be a reliable guide to future performance.