BY WILLEM VINKE
The Fund’s benchmark returned 2.92% in February. NYMEX WTI CRUDE was up 2.27% on the month to finish at $54.01. The US 10year treasury yield decreased 6bps to finish the month at 2.39% the German 10year treasury yield decreased 23bps to finish the month 0.21% and the Swiss 10year treasury yield also decreased by 17bps to finish the month at -0.23%. The UK 10year gilt yield decreased by 27bps to finish the month at 1.15% as legal challenges to the Government’s approach to Brexit will require parliamentary approval of proposals prior to triggering article 50.
Gold increased by 3.12% to finish at $1,248, with silver trading up 4.31% to finish the month at $18.31. The Euro weakened over the month against the US$, down 2.06% to 1.06 and weakened against sterling, down 0.48% to 0.85.
The Fund outperformed its benchmark by 0.45%* in February. Healthcare, Consumer Staples and Information Technology were the best performing sectors in the benchmark whilst the worst performing were: Financials, Energy and Materials. The Fund’s top performing stocks were: Phillip Morris, Shire and Heineken and the worst were: Pandora, NN Group and World Pay.
During the month the Fund exited UBS and bought Reckitt Benckiser. UBS was sold as the investment case is no longer as strong as it was, and to re-weight financials exposure away from beta and towards interest rate sensitivity. The position in Reckitt Benckiser was re-established following the announcement they would acquire Mead Johnson.
* EUR I Class.
The views and statements contained herein are those of Lofoten Asset Management in their capacity as Investment Adviser to the Fund as of 09/03/17 and are based on internal research and modelling.