Foord Global Equity Feeder Fund

Monthly Commentary – April 2022

• Global equities (-8.0%) slumped on US Federal Reserve communications that indicated more aggressive interest rates interventions to tackle persistently high inflation — while strict city-wide Chinese lockdowns continue to pressure supply chains and the Russia-Ukraine war distorts energy and commodity markets
• All developed markets ended lower, with US bourses (-9.1%) and European stocks (-5.8%) leading the declines —   New Zealand equities (-9.5%) fell sharply as the central bank aggressively raised rates by 50bps
• Emerging markets (-5.6%) were mostly lower with some exceptions — materials exposed South American markets Chile (-12.3%), Peru (-17.3%) and Brazil (-13.7%) were sharply down on inflation concerns and commodity retracement
• All sectors were lower apart from defensive consumer staples (+0.4%) — although the fall in the energy sector (-1.3%) was relatively small after three months of gains and the sector is the only one with a positive year-to-date return 
• The selloff in growth sectors picked up pace with tech (-11.7%), consumer discretionary (-11.0%) and communication services (-12.5%) lower — as the risk of higher rates and lower-than-expected earnings guidance pressured growth prospects
• Oil (+1.3%) gained marginally but was volatile intramonth with prices driven by uncertainty on supply, strategic reserves and Russian sanctions — soft commodities including wheat (+3.8%), soybean (+5.6%) and corn (+9.3%) rose as weather, the Ukraine war and high fertilizer costs were worries for crop yields
• Precious metals gold (-2.0%) and silver (-5.5%) declined — non-interest bearing metals face competition from fixed instruments whose real yields have finally risen above zero on speculation for more aggressive US Federal Reserve tightening 
• The master fund outperformed the index — driven by consumer staples, energy and consumer discretionary allocations
• The rand (-8.1% vs the US dollar) sharply retraced some of its recent gains in line with other emerging market commodity exporters and broad based US dollar strength — the currency is vulnerable to a reversal in the commodity export-driven terms of trade support

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.