The Sceptre UK Fund was up by 1.9% in August compared with a rise of 0.1% for the FT All Share Index.

As always, August was a very quiet month from both a news announcement and from a trading volume point of view with little going on. The Sceptre UK Fund portfolio performed well with most of the outperformance coming from half our holdings (8) that rose in value by between 6% and 14%, the other half of our holdings did very little over the month – except for 2 small cap names that declined by about 6% each. One of these accounted for our only trade of the month when we added to one position during this weakness.

Of our top three holdings (by weighting in the portfolio), two were unchanged on the month and with a 6% cash weighting the portfolio’s outperformance was generated by less than 75% of our stocks – a very solid performance. We expect these two stocks – a market leading, niche manufacturer and a Lloyds insurance underwriter to “pull their weight” over the coming months as trading statements and results are released.

We are still finding new ideas but have not found one “cheap enough” to add to the portfolio yet, we prefer the current portfolio and its weightings to the potential new holdings at their current prices and do not feel we have to be in a hurry to buy stocks. History tells us that patience is rewarded and the stock market will doubtless present us with a buying opportunity at some stage – and we expect to be ready - whenever that is!

We are keeping in close contact with all our businesses and know that they are all making good progress and there is little to give us cause for concern so, whilst the daily/monthly stock market pricing may be a little random, we can rest assured that the value of the businesses we own is increasing.

As always, if you have any comments or questions, please let us know,

Chris Broadhurst
CEO