Monthly Update
31 December 2022
The Fund was flat during December, behind its performance comparator of cash (as measured by the Bank of England’s Sterling Overnight Index Average (“SONIA”)) + 5% which rose 0.66%. It did provide some protection compared to the UK stock market, as measured by the FTSE 100 index, which fell 1.49%.
(Source of all figures: FE Analytics)
December was a gloomy month for the UK economy, with a series of strikes across different industries and public services adding to the general malaise already caused by the cost of living crisis in the run up to Christmas. At one point the FTSE 100 index was down by over 3% from the start of the month, before recovering in the last two weeks, but still ended the month down 1.49% on a total return basis. In this context it was pleasing to see the Fund providing a level of protection for investors, despite not providing a positive return.
Strategy 34 matured within the Fund during December. A gilt collateralised contract, it required its underlying index, the FTSE CSDI index, to be at or above its starting level to mature with a gain on its first anniversary. The index was up 2.34% on the observation date triggering the strategy to mature with a gain of 7.90%.
The proceeds were rolled straight into Strategy 50; a new gilt collateralised strategy similar to the original. A step-down shape linked to the FTSE CSDI index, it did however offer an improved coupon of 9.16% each year, with the level required for the strategy to mature dropping from its initial level after the second anniversary.
Further details of all the strategies within the fund can be found on the Fund’s website: www.UKDSF.com.
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.
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