Fortem Capital Progressive Growth Fund

UK & EU – For professional and institutional investors only
Switzerland – this is an advertising document for professional and institutional clients as defined by the Swiss Financial Services Act only

Monthly Commentary – 31st May 2022

Investors were granted some respite in May after a fairly torrid start to the year. A slight pivot from the Federal Reserve to a less hawkish tone after inflation slowed slightly, causing some to proclaim it had peaked, allowed both equity and bond markets to post positive returns on the month. NB – they are still correlated.

However, the broad risks of inflation, conflict, and Covid policy rather than Covid itself remain.

The Fund returned 0.6% over the month.

Within the Fund, the FTSE 100 continues to be the stand out performer across global equities. It’s equally weighted sibling underperformed it by 2.5% over the month. Meanwhile, most other equity markets posted modest positive returns. The Hang Seng has notably begun to recover as Covid restrictions begin to be lifted, the tech crackdown begins to loosen, and the Chinese Government attempt to stimulate the economy.

One investment called during the month, at the end of the first year of its life, returning investors 7.30% in growth as well as original capital. The investment was linked to the FTSE 100 and S&P 500. A replacement investment linked to the same indices was entered into in its place, with a headline coupon of 8.12% and a final protection barrier of 65% of initial strike.

The diversifier overlay returned -0.4% over the month as sentiment shifted and spreads narrowed.

With the relatively benign May out of the way, attention returns to inflation numbers for the same month. Any acceleration is likely to put risk assets, including bonds, back under pressure. The Fund, whilst not escaping the mark to market impact of equity declines, retains its significant protection over the medium term. And, if equities are to enter a paradigm of lower annualised returns than those investors have become used to, if not expect, then the pre-defined return profile that the Fund offers is something that should prove extremely useful in portfolios.

Total Return 2022 May
UK 100 4.8% 1.1%
US 500 -12.9% 0.1%
Europe 50 -10.1% 0.9%
Japan 225 -4.4% 1.0%
Hong Kong 50 -7.6% 2.1%
US 2000 -16.6% 0.2%
Swiss 30 -7.4% -4.1%
BCOM 32.4% 1.4%
US Treasury -8.9% 0.6%
Euro Property -14.0% -4.0%
PGF -4.9% 0.6%
AGF 0.0% -1.6%
Real Estate -13.5% -6.6%
US Equity Income -12.9% 0.1%


– This document has been issued and approved as a financial promotion by Fortem Capital Limited for the purpose of section 21 of the Financial Services and Markets Acts 2000. Fortem Capital Limited registration number 10042702 is authorised and regulated by the Financial Conduct Authority under firm reference number 755370.
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