Results Optarix US Portfolio April 2020

Results of the Optarix US Portfolio for the periods ending 30 Apr 2020 (USD based, after tax and fees):

Period	Total Return per year
1 year	-1.48%
2 years	5.24%
3 years	7.92%

Note: Past results are no guarantee or predection for future results.

Commentary

As the uncertainty persists caused by the spread of the corona virus, markets have recoved somewhat from their lows on 23 March 2020. While some comentators thought that we'll see a V-shaped recovery other voices increasingly anticipate a slow and prolonged recovery.

Our view is that much depends on how fast the economies can be opened up again in a safe way. The process would be much helped if virus testing would become comprehensive to detect and contain new outbreaks, if a medication became available to help with the treatment and in particular if clinical trials that have already started would demonstrate effectiveness with little or no side effects in humans. As of today, even the testing is not reliable in some cases as reports of false negatives for some tests show.

Throughout the downturn of the markets from their heights in February, we have kept all positions. In addition we've continued to balance positions. We saw a need for an increased number of rebalancing in the last few months which we believe was caused mainly by two factors. The first factor was the high volatility in the market in general. The other factor was the uncertainty about how well each company would handle the impact of the virus on their business. Underlying all of this was also the influence by the extreme changes in the oil price. The oil future was at some point at a price of minus USD 40.00 which clearly is completely out of whack.

Using rebalancing we benefited both from selling as well as buying opportunities which helped improve our portfolio's performance. It also appeared that more short selling for dividend aristocrats happened because of the high uncertainty. As a result we also benefitted to a very small degree from payments from share lending.

Looking forward we believe the uncertainty will slowly reduce over the next few quarters. We intend to stay invested and also re-invest all cash flows. With shares of high quality companies - and dividend aristocrats as a group are - we are confident that we continue to be well positioned for the long run.

As always you're welcome to leave your comments and thoughts on this below.