MARKET COMMENTARY

The FTSE100, a good measure of UK equities, was essentially flat over the course of 2022 which suggests a measure of calm. History books will be unlikely to concur with that assessment of the year.

November proved to be a good month for the VECTOR fund with a gain of +8.4%.

Our longer term performance also remains very strong. According to Trustnet figures, as at 30th November our fund ranked first in performance out of 234 funds (in the IA UK All Companies sector) over 5 years and second out of 244 over 3 years.

May we take this opportunity for the benefit of any new investors in our VECTOR fund, to reiterate our investment approach and ethos.

We finished last quarter with a sombre outlook: “As things stand at the end of the first half of 2022 we have a high conviction over the following: that inflation will persist, interest rates will rise, recession is coming and that high asset values cannot withstand these forces.”

SORBUS VECTOR fund enjoyed a good month in terms of relative performance, being down slightly 0.3% whilst the benchmark, the MSCI UK IMI All Companies Index, fell by 5.0%.

We noted at the end of Q1 2022 that markets and asset prices were displaying a tranquillity that was hard to reconcile with the deteriorating economic backdrop.

The SORBUS VECTOR six month commentary for the period ended 31 MARCH 2022 is shown below and is included in the SORBUS VECTOR half year accounts, copies of which are available to investors upon request.

As we end the first quarter of 2022 the performance of the FTSE100 (+2%) over the period would suggest a modest and tranquil progression. The disconnect between equity performance and the real world has been stark.

The SORBUS VECTOR six month commentary for the period ended 31/03/22 is shown below and is included in the SORBUS VECTOR half year accounts, copies of which are available to investors upon request.

We are currently quite pessimistic about global equity markets but very positive about the returns we can generate.

At first reading this may seem completely incongruous. Let us explain.

As we end 2021 and enter 2022 markets and asset prices will continue to be driven by the actions of major central banks and the Federal Reserve in particular.

For the second quarter running we have seen most equity and debt markets seemingly acting as grown ups – plodding along – while almost everything else seems a little broken and teenage.