Foord Global Equity Feeder Fund

Monthly Commentary – April 2020

• Global equity bourses (+10.7%) capped their best month since 1987 – unprecedented stimulus and flatter virus curves in the major economies bolstered hope for rebounding economic activity
• US markets (+13.1%) surged as the US Federal Reserve took further steps to avert economic collapse by providing $2.3 trillion to support households, businesses and local government – which includes $600 billion of credit support to small and mid-sized businesses
• Europe (+5.9%) underperformed due to its reliance on industrial activity as France’s economy contracted 5.8% month-on-month in the first quarter – its steepest decline since 1949 when records began
• Emerging markets (+9.2%) gained with their currencies and commodities despite more than 80 countries seeking IMF aid – Brazil (+5.4%) underperformed on poor COVID-19 management while India (+16.1%) outperformed as low oil prices improved the fiscal deficit
• Oil’s (+11.1%) volatility continued as May WTI contracts plunged into negative territory for the first time amid a lack of storage to take delivery – Saudi Arabia and Russia ended their oil-price war, agreeing to cut 10% of global supply for the next two months, nowhere near enough to offset the 25-30% collapse in near-term demand
• Fund outperformance expanded despite a high cash balance – Mesoblast (+157.7%) surged after its remestemcel-L treatment achieved meaningful results in treating a small sample of severe COVID-19 patients and progressed to comprehensive trials
• The rand (-3.9% vs the US dollar) weakened more as the economic shock of the extended lockdown compounds South Africa’s structural growth challenges – S&P downgraded SA debt further into sub-investment grade on forecasts of accelerating deterioration of public finances

The standard charge rate is a fixed fee of 0.35% plus VAT. A 0.85% fixed amount fee plus 15% performance sharing fee is charged in the Foord Global Equity Fund.