Fund manager commentary
Over the past month, the UK equity market continued to display no clear trend. In capital terms only the FTSE All Share Index is slightly below the level it attained at the start of this year. A small positive return has been achieved in total return terms when dividends are added back. Investors remained pre-occupied with the prospect of higher interest rates in the US and UK and when that might occur. Although UK corporate earnings are at last making progress, because a high portion of profits are generated overseas, the effect of sterling strength against both the dollar and the euro has held back the reported numbers when translated back into sterling. Investor sentiment remains cautious.
Against this background the FTSE All Share Index fell by 0.3% over the month whilst that of the FTSE Equity Investment Index rose by 0.1% (both figures are total return). The Net Asset Value of the Income Portfolio declined by 0.1% whilst that of the Growth Portfolio was lower by 0.8% (again both figures are total return). There was no activity during the month.
As at 31 July 2014
The value of shares and the income from them is not guaranteed and can fall as well as rise due to stock market movements. Past performance is not a guide to future performance. When you sell your shares, you might get back less than you originally invested. If markets fall, gearing can magnify the negative impact on performance. Changes in rates of exchange may have an adverse effect on the value, price or income of investments. Emerging Markets, Unquoted Companies and Smaller companies carry a higher degree of risk and their value can be more sensitive to market movement; their shares may be less liquid and performance may be more volatile. The fund may invest in hedge funds or private equity funds which are not normally available to individual investors, exposing the fund to the performance, liquidity and valuation issues of these funds. Such funds typically have high minimum investment levels and may restrict or suspend redemptions or repayment to investors. The asset value of these shares and its prospects may be more difficult to assess.