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Issued by 1OAK Capital Limited, authorised and regulated by the Financial Conduct Authority.  1OAK Capital Ltd (1OAK) (Registered in England & Wales Number: 06890293; FCA registration number 501453) provides fund management services for its customers. 1OAK Capital Limited is authorised and regulated by the Financial Conduct Authority. Registered Office of 50 Sloane Avenue London SW3 3DD.

Fund value rises as markets anticipate further post Covid growth.

The GBP B share class of the 1OAK MA80 was up 1.5% in March. Over the last year, the value of the fund has increased by 37.7% as markets recovered from the depths of the covid crisis. The dominant narrative has been the increasingly positive outlook for economic growth in the U.S.

This is positive for equities but has also caused yields and expected inflation to rise. U.S. 10 Year Treasury yields continued to push upwards, reaching a peak of almost 1.75% at month-end.

As a result, total returns for global fixed income were slightly negative. Equities ended in positive territory, while under the surface, the rotation from growth into value continued. The fund’s equity sleeve generated positive returns, while its fixed income and alternatives allocations ended the month flat. 

The funds best-performing holdings were all in the equity sleeve. Eurozone Equities performed well, producing a 6.56% return on the month. This was followed by Canadian Equities (5.03%) and U.K. Equities (4.41%).Increasing interest rates caused losses in fixed income assets.

Long Dated Treasuries fell -2.22% as rates increased. The value of Gold slid by -1.32%. Finally, Emerging Market Equities ended the month down -1.07%. This was primarily due to a steep selloff in Chinese Equities and dollar appreciation impacting other E.M. equity markets. Looking forward, Blackrock anticipates positive returns from equities and credit but are more cautious about fixed income. Central banks are expected to limit the increase of rates across the curve, so rising inflation may result in more negative real yields.

The non-equity sleeve remains an important diversifier and is expected to continue to improve the overall risk/return ratio of the fund.

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