The Fund posted a return of -4.00% for September, outperforming the sector average return of -4.58%.

Equity indices endured another difficult month in September. Although for now, on aggregate, corporate earnings appear to be holding up, there are concerns that the ever weakening economic growth outlook will eventually flow through. Weakness was particularly evident in areas of the market which would be considered more growth orientated, such as UK mid-cap, Chinese (via the Hang Seng) and US stocks. UK large cap stocks proved a little more resilient, helped by a lower exposure to sectors such as technology, but still ended up in negative territory.

UK fixed income also endured a difficult month. Returns were already negative but weakened further on the back of the fiscal announcement from the Chancellor on the 23rd. This was perceived as being over generous by many, with particular concerns about how it would be funded. This triggered gilt yields to fall even further, causing particular issues for pension schemes which had adopted Liability Driven Investment (LDI). Eventually, such was the concern, the Bank of England was forced to step in with a temporary bond purchasing program to purchase gilts. This caused bond yields to fall, but heavy losses were still recorded for the month.

During the month the allocation to equities was reduced in favour of cash. In particular, a position in a fund investing in UK equities with a material weighting to mid and small cap stocks and more growth orientated mandate, was liquidated.

Further information about the fund can be found on the Fund’s website: MIDSF.com

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.