Looking back on January 2022


Key points

  • The Fund fell 11.7% in January
  • That continues a fall that began in late-November, largely driven by fears of interest rate rises
  • These periods are uncomfortable, but this Fund has been through them before and they don't change our investment thesis

Our monthly update for January 2022 is now available.

The Fund fell 11.7% in January, which is one of its worst ever months. The only similar month was back in 2018 when, as now, markets were spooked at possible central bank interest rate rises. We don't think these falls are rational, but you have to accept what the market gives you in both the good and the bad patches, so we don't complain.

Recent surveys of investor sentiment are more pessimistic now than they were in the March 2020 Covid crash, in the 2008 GFC, and in the 2000 dot-com crash. That seems strange to us, given the world today compared to at those times. But that is the environment we're in right now.

We're not happy about January. But we accept there are times when this Fund's focus will be at odds with the market's current mood. This Fund has averaged 24%pa net returns over the last five years despite months like this. They are an unwelcome test of investors' resolve but we don't believe they change the long-term investment thesis of this Fund.

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