Portfolio Performance 2016/2017
The portfolio generated a total return of 23.5% in the year ending March 2017. In comparison, the FTSE All Share gained 17.8%.
The year was filled with plenty of macroeconomic events that caught investors’ attention, including Brexit and the US presidential election. Our strategy of ignoring the macroeconomic noise and stick to investing in high quality businesses allowed us to outperform the market for the fourth consecutive year. However our decision to avoid commodity related and financial businesses presented us with a tough challenge of beating the benchmark.
Our best performer in the year was an IPO we bought into last year, Mimecast. The email security company’s share price gained 164% in the year. Dot Digital, a new addition during the year, gained 63% and MasterCard, a company we have been invested in for several years, gained 37% in the year.
One of the cornerstones of our portfolio over the last several years ran into some unexpected trouble, as NCC Group lost 47% of its value. There were no other notable losses during the year, which is reflective of both the market conditions and our prudency in investing in only the best businesses.
Towards the back end of the year, we bought into the IPO of Global Benefits Group. GBG is a health-insurance business focused on the emerging markets with a market cap of less than £200m. We also purchased shares in a long time portfolio constituent, Dominos.