Report: Q1 2026 Market & Fund Performance

Jacob Reynolds (aka Jake – Courtiers Asset Management Director) and James Timpson (Head of Asset Management & Fund manager) cover key questions including:

• A year on from the tariff fallout, how have the funds performed this quarter?
• Oil is at the top of the written report this quarter when it’s normally at the bottom. Is 2026 all about oil?
• What performs well and badly in environments like this?
• Any reasons to be cheerful in what's been dubbed "Awful April"?

Issued by Courtiers Asset Management Limited, CAM0426051. Courtiers Asset Management Limited is Authorised and Regulated by the Financial Conduct Authority – Register No: 616322. Address: 18 Hart Street, Henley on Thames, Oxfordshire RG9 2AU. Tel: 01491 578368. 

Important information

Past performance is not a reliable indicator of future returns. The value of investments, and the income from them, can go down as well as up and is not guaranteed and you may not get back the amount originally invested. Any forecast, projection or target where provided is indicate only and is not guaranteed in any way. Certain types of funds might carry a greater investment risk than other investment funds. Further details of the risks are associated with investing in Courtiers funds can be found in the Key Investor Information Document or Prospectus, copies of which are available on request or at www.courtiers.co.uk.

Disclaimer

This communication is for information purposes only and should not be relied upon in making an investment decision. The views expressed by individuals and the business are based on market conditions at the date of issue and are subject to change without notice. The mention of any stocks or shares should not be taken as recommendation to deal and does not take into account the individual investor’s investment objective or risk profile. Where an investment or security is denominated in a different currency to the investor’s currency of reference, changes in rates of exchange may have an adverse effect on the value, price or income of or from that investment to the investor. Any third party sites, or pages which are linked to the document, have not b...

Transcript

SPEAKER_01 0:06

We're here for what is technically the first quarterly performance update of 2026, although we have been here before this year recording the last quarter of 2025. James, if I could jump straight in with you. We're a year on from the tariff fallout. How have the funds, the courtiers funds, performed this quarter?

SPEAKER_00 0:24

It's been a really funny quarter, sort of a tail of two halves, or rather two-thirds and one-third. You may remember this time last month we were sat here saying how amazing markets have been so far. Then come March, and suddenly there's a war in Iran, and we get a huge spike in market volatility. So the US, the key US index, the SP 500, that's down over 4% for the quarter. Similarly, European stocks, they're down over 3%. And UK sort of medium and small cap stocks, they've had a really tough quarter as well. They're down around 4-5%. However, the funds have actually generated a positive return for the quarter. The balanced fund and the growth funds, they're both up around half a percent. And the cautious fund is up 0.4% as well, which shows you the benefits of diversification. Some markets that have actually done okay in the last quarter are UK large cap, so the FTSE 100 index, that's up over 3% for the month. For the quarter, sorry. So the fact that the funds have still managed to generate positive returns in this huge spike in volatility that we've seen because of the conflict in Iran just shows how important it is to be diversified.

SPEAKER_01 1:37

Could you give me an example off the top of your head what might have been a tricky, challenging investment decision going into this quarter? What might investors have been in that would have caused them to suffer?

SPEAKER_00 1:51

Things which have been especially volatile are um long-dated guilt. So one of the impacts of the conflict in Iran is um because of the massive shortage of oil that it's caused. Um we've seen a huge spike in the oil price, which has set has completely changed inflation expectations. Because inflation is now expected to rise, um, interest rates are also expected to rise. Um I think you know, just over a month ago we were forecasting a couple of rate cuts during the year, and now we're expecting a couple of rate increases instead. So if you're heavily invested in long-dated bonds, that would have hit you as well. Interestingly, there's also been a huge spike in volatility of gold. So gold normally acts quite defensively when you see these spikes in volatility. Um, but gold actually lost 11% uh last month. Um but and uh the volatility of gold is actually around three times higher in the last 90 days than the volatility of equities.

SPEAKER_01 2:51

Jay, can I go back to oil? That's at the top of the written report this quarter, yeah. When it's normally at the bottom.

SPEAKER_02 2:59

Well, it has been buried down there. So each quarter, James will hand me 47 market uh performances, and we look at that. And last year we obviously do the quarter and we sum up the year, that's when when we're here in January. And oil was the only negative asset on that sheet of paper last year. So now we're here, it's up 94%. So you know, we talk about the market pendulum, but that's a very, very, very rapid swing. Um, but obviously, you know, as James uh said, the funds to the end of February were were doing really well. 28th of February, Israel and and the US have have um has struck uh Iran and and that's uh created uh a shortage of oil because they have used their weapon against the Western world, which is to block the Strait of Hamous. Now it's not as bad as it is in the 70s, so oil price spikes claw caused recessions in the UK and US in 1973, in 1979, and in 1990, all for similar but different reasons. Um, you know, in 73 there was an the Saudis did an oil embargo uh on the Western world, and that that was very, very painful. 79 was actually the Iranian Revolution, uh, and and that just caused an actual supply delay because the the government that took over didn't didn't run the refineries as well. So that was um an interesting one and what one that hurt for the UK. But nowadays, back then 60% of oil went through the Strait of Hormuz. Nowadays, only 20% uh goes through the Strait of Hormuz, so you've got that uh to fall back on, which is which is means it's less painful. However, if you lose 20% of your market supply, there's going to be spikes, and also there's market dynamics that are emerging, uh particularly in each country. So diesel prices in the UK have shot up. It's not an illusion. I don't know if people are listening to this drive a diesel, it's not an illusion that it appears to have gone up way more than petrol. It's because we've got no diesel refineries in in the UK. So stuff stuff like this. If you have to import that, people don't really want to export it to you right now because they're worried about their own supply. So uh there's these interesting things cropping up that really uh bring to light uh policy decisions of the last 20 years, and and you see uh in a crisis how they actually manifest as uh as as price shocks.

SPEAKER_01 5:22

Is it fair to say that the 20% of world's oil passing through straightforward moves now compared to 60% in the 70s would be a fair example of diversification?

SPEAKER_02 5:32

Yeah, yeah, definitely. I mean we spoke uh Q2, um I think the Q2 report last year, I know it was the Q3 report uh after the 12-day war, which was the the initial strike by the US. I think one where Trump probably thought that went so well. Let's see um this one possibly will be over really quickly as well. Um, and that was when they jumped the buck bunker busters on the Iranian, what believed to be the Iranian nuclear facilities, um, the enrichment programme. Um an oil spike then. But and we talked about how that actually went straight back down again because the dynamics are different in this day and age. Uh, US have become a net oil exporter back in the 70s and 80s, they were hugely dependent on imports. Um, however, these markets do clear at international prices, so if there is a lack of supply across the globe, the people in the US will be getting hit with higher oil prices as well, even though they are a net importer, but it won't be as bad as as countries that are uh, even though they're a net exporter, it won't be as bad as countries that are net importers uh of oil. They're the ones that really really feel this. But um, yeah, it the the the dynamics have changed, partly because of fracking. Um the US added eight million barrels of oil a day uh through fracking over the last I think ten years, and that's the equivalent of adding a Saudi Arabia of of supply to the world. And that's why the oil price kept going down. There was oversupply. Uh now there's not right now. But hopefully it's it's like uh five years ago where the ever given had blocked the Suez Canal. Hopefully, this is just a blockage, all the facilities are are good, and once this gets open, we can it will be a little bit of time because obviously these ships take a long time to get to the UK, but once once it's unblocked, hopefully we can go back to uh go back to uh lower oil prices.

SPEAKER_01 7:26

Yeah, and there's a deadline looming, isn't there, for basically Wednesday the 8th. What's gonna happen? So markets are holding steady right now, waiting for an answer. It'll be Thursday, it'll be Friday.

SPEAKER_00 7:37

Well, I have to admit I was slightly nervous coming in this morning because as much as we love a four-day weekend, it does mean that when markets open on Tuesday, they've got four whole days worth of news to catch up on. And four days is a long time at the moment. And what did it look like? It's actually okay. That's actually some green on the screen, which was quite nice to see. I wasn't as nervous as um Rajat was in an analyst in our team. He's getting a CFA level three results today. Um so he's sort of on 10 seconds. I think it's coming in about an hour. So if he fails, then edit this patal. But if you're watching this, you passed everyone. Well done, Rajat. Well done, Rajat.

SPEAKER_01 8:12

Domino's all round. Oh, well done, yeah. Good luck, good luck. Um, James, if I can come back, we did touch briefly on what might have been challenging investments uh heading into all of this. Just can you tell us any more about what does well and what does badly in times like this?

SPEAKER_00 8:28

Um something which does act quite defensively during times like this is the dollar. Um the US dollar has appreciated against the pound by nearly 2% in the last quarter. Um then some of the other traditional safe havens that I just mentioned, um, gold um earlier on, that hasn't done so well. Although, interestingly, um, even though it is down over 11% for the month, it's still up for the quarter, it's still up around 8%, which just shows how volatile gold has been so far. Um and similarly, uh other defensive assets such as government bonds, they've also not done so well just because of all the um changing inflation expectations. So it's been quite a strange time, but I know I say this word a lot, it just again shows the importance of diversification. Yeah, well, we can't hammer it home enough.

SPEAKER_01 9:14

Yes. Excellent. Um this, with all the rising costs closer to home, um, has led to this dubbing of the term awful April, Jake.

SPEAKER_02 9:29

Yeah, I see it cropping up a lot on the news at the moment. It's not a great way to introduce April, is it?

SPEAKER_01 9:34

Anything for us to be cheerful about?

SPEAKER_02 9:35

Yeah, well, I I things come to an end. You know, oil price uh appreciation ends up in oil price depreciation, that's or always happens. Um, so we will watch the stuff that's done well in the portfolio because of the conflict um and see wherever it's a good position to exit. Um, but you know, the the performance as James Lewis is really strong. But further, you know, despite all these things seem to happen at the beginning of the year at the moment. September is the meant to be the worst uh month for markets, but actually it seems like February, March, and April are really trying to take the crown off of it.

SPEAKER_01 10:12

Settings up for nice September.

SPEAKER_02 10:14

Yeah, nice September because COVID obviously happened in March. Splendid September, yeah.

SPEAKER_01 10:19

Superb September.

SPEAKER_02 10:20

That'd be nice. Um Silicon Valley Bank happened earlier in the year. Um uh we had um I mean 2024 we had uh the um August 5th sell-off that James spoke about at the seminars. Um also in um 2022, we obviously had the Russian-Ukraine crisis. So um that these things always seem to happen at the beginning of the year at the moment, but uh hopefully, um, hopefully next year it won't be as bad. But in the times, it's interesting to talk about the 2022 conflict because Germany had to get itself off of Russian gas very quickly. Um, by the end of 2022, they completely cut it off. It was over 50% of their imports. In the space of 200 days, they built a liquefied natural gas terminal, which shows it's a real message to our our government. It shows that when you really need to do something, you can get it done, especially when you think about the housing crisis in the UK. But we're seeing that about so the world runs on about 100 million barrels of oil a day, 20 million of those come through the Strait of Hormos. Even by March, the deficit was only 15 because we found new ways to re-route it, and then by the end of um by the end of March, by the beginning of April, uh it is estimated that that's down to only an 8 million deficit because of more uh human ingenuity. And so um it it it's great that you see these things, and actually, do you know what that won't just reduce the dependency on the Strait of Humus in the short term, that will reduce it in the long term as well, because obviously if Iran are going to use this as a weapon, then people will want to find ways to make sure that it can't be weaponised against themselves.

SPEAKER_01 11:54

Yeah, and not discounting all the shock and atrocities that we're hopeful that this will teach mankind to think smarter and be smarter.

SPEAKER_02 12:02

And and you think about all those all those conflicts that we've had at the beginning of the year over the last uh five, six years, despite that, you know, the growth fund over ten years to the end of February was compounding up double digit returns. And so you just got to look through this, ride out of the volatility. Volatility is a price you pay, as James said, we diversify and we go on. But there's one one thing that is good, and I know that net zero gets a lot of flack, and there's lots of criticisms with our um our UK energy policy, but God bless the wind last week because it was producing about 48% of the UK power. Um, so those those uh those strong winds that were knocking over your garden furniture was also power in the UK, and that reduces our dependence on gas. So at the moment, because obviously gas is is tied up all into this this conflict. So uh yeah, God bless that, and then that's that was um was helping us out.

SPEAKER_01 12:54

I was going to ask if we're invested in any outdoor furniture businesses.

SPEAKER_02 12:58

No, but we are investing in wind farms, so they're recording record production, and uh there's two two uh small positions and a solar farm, and um they're getting great output and they have government backed revenue, and then they estimate over the long run that they can produce power at about£40 a megawatt, and that's much cheaper than the prices that we're paying at the moment.

SPEAKER_01 13:18

Well, thank you for the insight, James. Anything that you'd like to add for this quarter?

SPEAKER_00 13:22

Um, one other interesting stat I had is that the straight-off Homer's Wikipedia page had 171 times as many views last month than it did in December. There you go.

SPEAKER_02 13:32

90% of that's for me trying to learn.

SPEAKER_01 13:38

Oh, it's not it's interesting. If you could if you could see what are the most top ten Googled or searched for phrases and words in the world right now, you'd know what the world's most interesting points are. Definitely. What's the world most interested in at the moment? I wonder if uh Artemis 2 could see that. Yeah. Thought bubbles. Um anyway, back to Earth. Jake, anything you'd like to add before we wrap this one up?

SPEAKER_02 14:02

No, I think um we've covered it all. Um I can't just looking at James's uh all market returns, but I think uh I think we've we've spoken enough.

SPEAKER_01 14:12

Hopefully into the next quarter.

SPEAKER_02 14:14

Yes, always.

SPEAKER_01 14:15

Fantastic. Thanks, Leo. Well, thank you both very much for your time once again. I look forward to catching up with you next month, James, and you both together for the next quarterly.

SPEAKER_02 14:22

Thank you, Leo.

SPEAKER_01 14:23

If you do have any questions, please do speak your advisor or contact us through the website. Thanks.