Equity markets were a mixed bag during July, with a wide dispersion of returns seen. At the top of the table were UK equities, in particular mid and small companies. The share prices of these entities performed well, supported by a stronger than expected economy, whilst at the same time the likelihood of an interest cut by the Bank of England increased. The fortunes of smaller companies in particular are more reliant on the domestic economy compared to their larger peers. At the bottom of the pile, however, was the Hang Seng. After a meaningful rally from a depressed valuation level, it succumbed to profit taking. We also saw a negative return from Japanese equities, although they finished off their low point for the month.

UK fixed income markets were positive for the period. Whilst a positive return continued to be seen from high yield bonds, it was for the first time in a while not the strongest performing. That title instead went to investment grade corporates, closely followed by gilts. The latter two asset classes took comfort in inflation remaining at 2% for the second consecutive month. This heightened the belief that the Bank of England would soon embark on an interest rate cut. This was delivered on the first day of August, reducing by 0.25%, although the decision was close at five in favour, and four in favour of no change.

The Fund outperformed the sector average during the month, returning 0.85% and 0.30% respectively. With UK equities performing well it was unsurprising to see that three of the top four performers were indeed those funds investing in this asset class.

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.