‘Twas not really the month to be jolly for Minotaur in December. The fund eked out a 0.7% gain, though this was a bit lower than our benchmark. We saw good moves in some of our key holdings like IperionX, CD Projekt, and Chugai, despite a lack of newsflow. Our shorts also contributed positively.

On the flip side, investors continue to shun European stocks amidst political instability in France and Germany, and we saw this with our French stocks underperforming. Since President Macron called a snap election in June, French assets have been dragging on Europe. France’s divided Parliament has been unable to tackle the country’s mushrooming budget deficit. Other large detractors for us were some of our tech stocks which posted strong results but perhaps not as strong as the market was expecting.

We were also potentially too early into China which we waded into with a small basket of stocks that underperformed in the month. It looked good earlier when China said it plans to loosen monetary policy and expand fiscal spending but this gain reversed due to a lack of detail on the specifics of a fiscal stimulus plan and weak retail sales numbers. That being said, we still see opportunities in China given the strong fundamentals and cheap valuations available. The risks are real but the negativity might just mean opportunity for the bold investor.

Overall, it was a ho-hum month but fund performance is rarely a linear, up-and-to-the-right path. We remain sanguine and assess what we could have done better and what we have learnt. We try not to react to these short-term movements and keep our long-term mindset intact. As Plutarch says, “Character is a long standing habit.”