IFSL RC Brown UK Primary Opportunities | Fund Update | November 2024
November: UK equities make progress as US equities surge on Trump 2.0
Donald Trump will become only the second President of the United States to serve non-consecutive terms, as America chose to elect a President that is not without controversy. The US market reacted positively to his election as he is expected to cut taxes and regulation which should drive economic growth. Inflation is however expected to be higher given this fiscal expansion, albeit the Federal Reserve still cut rates in November, though fewer rate cuts are anticipated next year. The UK also chose to cut rates by 0.25% to 4.75% though, like the US, fewer rate cuts are now expected in 2025 as the government spending announced in last month’s budget, is expected to keep inflation above the Bank’s 2% target for the foreseeable future.
Cohort was added to the portfolio as part of an equity fund raising. We also added to the holding in Duke Royalty as part of an equity raise to fund further investment in its portfolio companies.
In November, the IFSL RC Brown UK Primary Opportunities fund returned 2.0% compared with 2.5% for the FTSE All Share and 2.2% for the IA UK All Companies sector, all on a total return basis.
Purchases
Cohort
Cohort provides intelligence and communication services to customers in the defence and security industry. We acquired the shares as part of a £40m placing to fund the acquisition of an Australian company focused on satellite communications. The shares have reacted well to the earnings accretive deal and are currently trading at more than a 15% premium to the placing price. Given the company’s strong order book in an uncertain world, we believe the company has strong growth prospects.
Sales
Underperformer Pennon was sold. Elixirr and Kitwave were trimmed on strength whilst the banking sector enjoyed a further strong month which led us to trim back our holding in Barclays.
Cumulative Performance (Total Return %) – To 30 November 2024
| Fund/Benchmark Name | 3M | 6M | 1Y | 3Y | 5Y | 10Y | Since Inception (28/05/1997) |
| IFSL RC Brown UK Primary Opportunities P Acc | -1.2 | 2.4 | 13.2 | -1.8 | 15.3 | 78.3 | 497.1 |
| Quartile Ranking IA UK All Companies | 3 | 2 | 4 | 4 | 3 | 2 | 2 |
| IA UK All Companies | -1.3 | 1.2 | 15.3 | 11.6 | 22.2 | 68.7 | 359.3 |
| FTSE All Share | -0.5 | 1.9 | 15.8 | 25.5 | 32.2 | 81.1 | 411.4 |
Source: FE: 30/11/2024
Discrete Annual Performance (Total Return%) – To 30 November 2024
| Fund/Benchmark Name | Year to 30/11/2024 | Year to 30/11/2023 | Year to 30/11/2022 | Year to 30/11/2021 | Year to 30/11/2020 |
| IFSL RC Brown UK Primary Opportunities P Acc | 13.2 | -1.3 | -12.2 | 22.7 | -4.3 |
| Quartile Ranking IA UK All Companies | 4 | 3 | 4 | 1 | 2 |
| IA UK All Companies | 15.3 | 0.7 | -3.9 | 17.2 | -6.6 |
| FTSE All Share | 15.8 | 1.8 | 6.5 | 17.4 | -10.3 |
Source: FE: 30/11/2024
Please be advised that the past is not necessarily a guide to future performance. Investments and the income derived from them can fall as well as rise and the investor may not get back the amount originally invested.
