Investment Manager’s Commentary

Your Fund returned -2.4% during the month compared to -1.9% for the IA Global (TR) sector.

Numerous surveys attest to how Donald Trump’s destructive and chaotic trade policy has done immediate damage to consumer and corporate confidence. However, the suspended full implementation of Mr Trump’s tariffs and robust employment trends create a twilight zone with no meaningful contraction in economic activity. This resilience is evident in the quarterly results recently reported by the portfolio’s companies. Overall, the message from them is one of stability, best seen, for instance, in spending data provided by card networks Mastercard and Visa. Payment volume trends in April show broad-based consistency across geographies and categories. Where pockets of softness have emerged, they are relatively isolated – in U.S. inbound and mass-market U.S. domestic travel, for example. Chinese consumption also remains weak

For their part, investors are in no mood to look kindly on any sign of deterioration. Despite exceeding earnings expectations for the quarter and reaffirming the outlook for the rest of the year, Fiserv shares fell over -18% after reporting lower than expected volume growth for Clover, its payment terminal and software service for small businesses. We see this as a severe overreaction and one that overlooks Fiserv’s diverse momentum across its fintech services, Fiserv’s improving financial productivity, and the company’s long track record for delivering on its commitments.

Investors’ sensitivities are creating opportunities within the portfolio. During the extreme volatility experienced at the start of April, valuation discrepancies widened sufficiently to motivate a reallocation of capital. In general, this favoured U.S. software and internet companies whose valuations had fallen to historically low levels, at the expense of predominantly European companies whose shares had outperformed and re-rated. We also added to Fiserv after its share-price decline. These actions, and the valuation opportunities they exploit, combine with the enormous underlying strength of the Fund’s companies. We have high confidence in their long-term trajectory in what remains a deeply uncertain time for the global economy.

Past performance is not a guide to the future. The value of the shares and the income from them can go down as well as up and you may not get back the full amount originally invested. Source: Yealand Fund Services Limited, NAV to NAV in sterling with net income reinvested. Returns are shown net of annual management charge, other expenses and net income reinvested. Returns do not include the effect of initial charges.

Investment Objective and Policy

The Company’s investment objective is to seek to achieve long term (at least 5 years) capital growth with some potential for income.

To achieve the investment objective, the Company’s investment policy is to invest principally (at least 80%) in a portfolio of global equities, and may also invest in other transferable securities, bonds (both corporate and government debt securities), collective investment schemes (“CIS”), warrants, money market instruments, cash, near cash and deposits. The Company may borrow and may enter into underwriting arrangements. It is the ACD’s intention that derivatives and forward currency transactions will only be used for the purposes of efficient portfolio management, including hedging, as defined by the Regulations.

The Company is actively managed and has, with the exception of the above noted minimum, no limit to which it can be invested in each sector or asset type, nor is there any particular geographic focus. The Portfolio Manager has full flexibility to adjust the proportion of the property of the Company depending on their view of market conditions and the assets which it believes are most likely to achieve the Company’s investment objective. From time to time the liquidity of the Company may be increased substantially if judged to be in the interests of investors.

The Company may invest in CIS which have different investment strategies or restrictions than the Company, including the ability to invest in derivatives for investment purposes and to gain exposure to assets which are not expressly listed above. Investment in CIS will usually be limited to those which invest primarily in the assets listed above and without exception, CIS will only be held in so far as the rules permit the Company to gain exposure to the assets held by those CIS.

A Glossary of Definitions which provides definitions to some of the technical language used on this website is available from www.yealand.com/policies.

Comparator Benchmark

To gauge the relative performance of the Fund, Shareholders may compare the Fund’s performance against the Investment Association’s Global Sector. This is not a performance target nor constrains the way in which the Fund is managed. For further information on the Sector and its intended use, please refer to the Fund’s Prospectus.