The performance of the Fund was positive in March, posting a return of 1.63%.
(Source of all figures: FE Analytics)

This month was a positive one for UK equity markets in general. Investor focus remained on the economic data which could influence the path of interest rates, with markets keen to see the continuation of the disinflationary theme. In the UK, the consumer price index, the inflation measure against which the Bank of England has a target of 2%, fell more than expected in February, posting a rate of 3.4%. This was markedly down from the previous reading of 4%.

Whilst still clearly above 2%, investors interpreted this move as being encouraging. With wage inflation (excluding bonuses) running above 6%, this potentially bodes well for an economy driven largely by consumer spending. This could prove a positive influence on corporate profitability.

Towards the end of the month, we saw the successful maturity of Strategy 54, which was a gilt-backed over-the-counter trade. The strategy matured on its first anniversary, after 12 months, with the FTSE CSDI index being above the initial strike level of 167.98. The strategy returned £1.1016 per £1 unit invested. There were no further potential maturities during March.

A new strategy was added to the Fund, Strategy 69. This was in a note from, issued by the Canadian Imperial Bank of Commerce (CIBC). This investment has the FTSE 100 as its underlying index. A maximum 7-year contract requires the index to be at or above the initial strike level to mature with a positive return, with the potential to kick out from the second-year anniversary and every 12 months thereafter, until the final value date. For each year that it is in force it will accumulate a coupon of 8.60%.

Further details of this and all the other strategies within the Fund can be found on the Fund’s website: www.UKDSF.com.

The value of this investment can fall as well as rise and investors may get back less than they originally invested.

The Fund is suitable for investors who are seeking capital growth over a medium to long term horizon but who are willing to tolerate medium to high risks due to the potentially volatile nature of the investments.

This article is for information purposes only and should not be construed as advice. We strongly suggest you seek independent financial advice prior to taking any course of action.

The Lowes UK Defined Strategy Fund is a sub-fund of the Skyline Umbrella Fund (ICAV) and is regulated by the Central Bank of Ireland. The KIID, Prospectus, and Supplement can be accessed by visiting UKDSF.com/literature and are only available in English.

Lowes Investment Management Ltd, Fernwood House, Clayton Road, Newcastle upon Tyne, NE2 1TL. Authorised and regulated by the Financial Conduct Authority.