JPMorgan Claverhouse beat the FTSE All-Share Index over the first half of 2015, posting a 4.2% return on net assets as compared to a 3.0% return on the benchmark. The discount to net asset value at which the Company’s shares trade widened out from 3.4% at the end of the last financial year to 6.6% at the half year end. The consequence of this was that the share price total return for the six months was marginally behind the benchmark at +2.5%.
The best performing stock in the first half was their long term overweight position in the media group, ITV. This company announced a fifth consecutive year of double digit profit growth and increased its annual dividend by 34%, whilst also returning part of its strong cash generation to shareholders through a third consecutive special dividend. They think this stock remains attractive both in terms of its valuation and its ability to beat market expectations. Jupiter Fund Management also performed well, increasing its dividend strongly, whilst also paying a special dividend.
Other successful stocks included a number of housebuilding and property related stocks including Galliford Try, Taylor Wimpey and Berkeley Group, all of which announced good results, but also benefited from the positive sentiment towards the domestic cyclical stocks following the general election result.
By contrast, the biggest detractor from their performance relative to the FTSE All-Share index was the underweight position in BG Group which received a takeover approach from Royal Dutch Shell in early April. Two premium dividend yielders, Royal Dutch Shell and the leading iron ore producer, Rio Tinto, also performed poorly over this period, as they suffered from weakening commodity prices.
JCH : Claverhouse beats UK market in H1