The unaudited net asset value of Athelney Trust was 310.3p at 31 December 2021.
Fund Manager’s comment for December 2021
Over the past month the US Federal Reserve has signalled a less accommodating policy due to US Inflation increasing to levels last seen in the 1980s. In addition to being reflected in the statistics, rising prices were also a material factor in the disappointing retail sales figures with industrial activity beset by supply issues as well.
In the U.K., GDP data for the third quarter was revised down to 1.1% from 1.3% confirming that the economic recovery is still struggling to gain momentum. Consumer spending was in fact adjusted up to 2.7% while government spending, business investment and fixed capital formation were revised downwards. Economic data for the final quarter will reflect the impact of the rapidly spreading Omicron variant which is likely to delay further the economic recovery and which could in turn delay the raising of interest rates by the Bank of England (BoE).
The stock markets on the other hand were far more positive with the MSCI increasing by 4.2% during the month, largely due to a strong performance by the US market where the S&P500 index reported an overall increase of 4.4%. This is a reflection of positive investor sentiment in the U.S. also evident in the four-point increase in the consumer confidence index in December which shows that consumers remain upbeat about the economy and appear to be somewhat desensitized to each new wave or variant of COVID.
The UK markets also responded positively with the broad indicator, the FTSE 250 Index closing up by 4.3% over the month. This month was the complete opposite of last month in that the large cap stocks out-performed the small cap stocks. The Small Cap Index only increased by 2.7% as compared to the FTSE 100 Index which increased by 4.6% while the AIM All Share Index was up by 2.5%. The Fledgling Index increased by a mere 0.4% during the month.
Our portfolio increased by 5.0% during December, reflecting the positive sentiment in the stock market over the period and we are proud to report that the portfolio increased by 29.1% for the twelve months to December 2021 as compared to the FTSE100 which increased by 14.3%. The 4.8% increase in the NAV over the month reflects that the expenses continue to be contained. We have remained fully invested, making no changes to our existing positions during December with cash comprising 3.6% of the portfolio at month end.