The Fund returned -0.82% during the month, behind the IA Flexible Investment sector average return of -0.37%.

Equity markets were generally weaker during the month on a local currency basis, with the exception of Japan. There was also a rotation of the leadership which we have seen for most of 2020, with the UK and Europe outperforming the US. Within UK fixed income high yield credit was negative whilst investment grade meanwhile posted a positive return, although they trailed gilts.

Despite weaker returns from equity markets there were some positive returns posted by underlying fund holdings. Returns from Japanese funds were particularly strong, with Baillie Gifford Japanese Smaller Companies, for example, returning double digits. Despite positive returns within the asset class fixed income holdings struggled to keep pace, in particular strategic bond fund holdings. The position in a silver ETC was detrimental to Fund performance as the precious metal gave back some of its previous gains, with real yields in US Treasuries moving less negative.

The Fund remains underweight its neutral allocation to equities. Tail risks remain, such as the potential for further lockdowns caused by the increase of COVID-19 cases which we are seeing across Europe, and the negative impact that this could have on economies. The US election will soon be upon us, the US are yet to agree an extended fiscal package and last but not least Brexit talks are yet to reach a positive outcome. We can’t forget however the supportive role which central banks, on a global scale, are playing. For this reason we are reluctant to reduce exposure to equities further. Their actions also continues to support our overweight position to fixed income, with central bankers appearing keen to keep yields low and ensure there is sufficient liquidity in credit markets.

This article is for information purposes only and should not be construed as advice. We strongly suggest you seek independent financial advice prior to taking any course of action.

The value of this investment can fall as well as rise and investors may get back less than they originally invested. Past performance is not necessarily a guide to future performance.

The Fund is suitable for investors who are seeking to achieve long term capital growth.

The tax treatment of investments depends on the individual circumstances of each client and may be subject to change in the future. The above is in relation to a UK domiciled investor only and would be different for those domiciled outside the UK. We strongly suggest you seek independent tax advice prior to taking any course of action.

Past performance is not a guide to future performance.