Financial markets have for the most part been positive as a result of better public health outcomes following large scale vaccinations of the population in developed economies.  Despite some economies not performing as expected, global economic data during the month highlighted a theme of global demand continuing to outstrip supply.  In an interesting twist, Chinese technology stocks declined sharply as Beijing launched a regulatory assault on education businesses and companies that handle large amounts of data, as well as an overhaul of how Chinese groups list on stock markets outside their country.

In the United Kingdom, officials pressed ahead with fully unwinding restrictions in spite of an increase in case counts and scrapped quarantine for fully vaccinated EU and US visitors.  The latest Red Flag Alert research for Q2 2021 recorded 650,000 businesses in ‘significant financial distress¹‘ which represents a decline of 10% from the highest recorded number of significantly distressed businesses in Q1 2021 (723,000).

Dividend income from our investments continues to improve and YTD is well ahead of last year’s receipts, contributing to the 5.81% increase in the total value of our portfolio over the month.  Costs were well contained which culminated in a 5.39% increase in the NAV for the month.  By comparison, the FTSE 100 was down by 0.07%, the FTSE 250 Index was up by 2.56% and the AIM All Share Index was up by 0.22%. The small caps were mixed, with the Fledging Index down by 0.35% while the Small Cap Index was up by 0.24%.  Elsewhere, Global markets ended the month in positive territory, with the MSCI increasing by 1.72% and the S&P 500 up by 2.27%.

There were minor changes to the portfolio holdings during the month as we top sliced our exposure to AEW and added to our holding in Fevertree Drinks.  Cash received by way of dividends resulted in a slight increase in the overall cash position which currently represents 2.6% of the portfolio value as at the end of July.