I am pleased to present International Biotechnology Trust’s factsheet for July 2019.
From a domestic standpoint, the UK saw the appointment of Boris Johnson as the new leader of the Conservative party and the country’s new prime minister. With this appointment, the likelihood of a no-deal Brexit has undoubtedly increased and the market reacted accordingly as the pound weakened by over 4%. Such volatility will increase as the UK nears the cliff-edge but, as regular readers will be aware, the Trust has minimal exposure to GBP. As per the figure extracted from the Factsheet below, 86% of the companies we hold are US-domiciled companies. Of the 14% EU-domiciled, approximately half of these are held via USD-denominated listings and less than 2% are GBP holdings.
Figure 1: Geographic exposure of the Trust as at 31 July 2019
Moving away from domestic matters, concerns continue to mount over the growth of the global economy. The healthcare sector is perceived to be non-cyclical and is often better protected from downturns caused by the end of an economic cycle, just as it was in 2008. That said, the biotech sector is higher beta than the broader healthcare sector, so near-term volatility is to be expected during these uncertain times. We continue to monitor the situation and have a conservative approach to gearing, but we leave others to speculate. Instead, we continue to do what we do best: build a portfolio of the best stocks within a thriving biotech sector to provide our investors with long-term returns.
Thank you for taking the time to read our factsheet.
July Factsheet (click link to open)