The fund was launched in August 2018 to invest in listed securities that derive their value from underlying real assets and targets CPI +4% over a full investment cycle. Investments can be via REITs, investment trusts or specialist companies with a focus on physical assets.
December 2018 - Latest commentary
The market rally at the end of November continued for only a few days into December before it gave way to renewed downward pressure. Although there were no new catalysts for the weakness, the S&P 500 index fell over 15% during the month before recovering to end down just under 9%, its worst December since 1931. Elsewhere, things were not much better; the Nikkei225 index also fell by 15% at its worst point while other markets lost between 5% and 8%. Government bonds were the main beneficiary of stressed equity markets with yields tightening across the board.
With the major equity markets under pressure over the month, the fund demonstrated significant resilience during the period. Against the negative backdrop, the fund saw negative contributions from renewable energy, property and other alternatives, whilst infrastructure was a small positive contributor over the month. Property was the largest negative contributor, detracting -0.41% from performance.
Investment activity in the underlying portfolio holdings continued with acquisitions of European property, tanker ships, music catalogues and a variety of UK and European renewable assets. At portfolio level we added a new holding in the renewable energy sector through a new IPO. The proceeds from this have already been deployed into a seed portfolio of energy efficiency assets.