Market outlook from Dr Stuart Rollason, Investment Director, Puma AIM IHT portfolio

In Q4 2023, the Puma AIM IHT model portfolio increased by +9.98%, outperforming both the FTSE AIM All-Share Index, which increased by +5.11%, and the FTSE All-Share Index, which increased by +2.54%. Since inception in July 2014, the cumulative performance of the model portfolio has increased by +96.90%, outperforming both the FTSE AIM All-Share Index (-2.81%) and the FTSE All-Share Index (+17.55%).


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Dr Stuart Rollason, Investment Director, Puma AIM IHT portfolio comments on the last reporting period and the outlook for this reporting season:

“In this reporting period, the Bank of England held interest rates at 5.25%. Various economic reports and data published signalled that the interest rate cycle tightening had peaked, with the next move expected to be a reduction. The market has turned its attention as to when that fall will occur; a significant development.

“Twelve-month CPI inflation fell from 6.7% in September to 4.6% in October. I stated in my Q3 Report that the end of interest tightening is an important stage in the economic cycle and that, historically, when recognised, it has led to a market rally. I suggested that the missing ingredients for a recovery were the final acknowledgment that interest rates will go no higher and the return of investor confidence. Markets typically look for a catalyst before changing a direction of travel. The sharp fall in October CPI inflation to 4.6%, announced in November, was the catalyst that led to a significant market rally. Commentators stopped talking about potential interest rate hikes and began speculating about when interest rates would fall. A further fall in CPI inflation to 3.94% in November heralded a further market rally in December.

“The principal reasons cited for a fall in CPI inflation was comparative falls in energy prices. Nevertheless, the focus of the Bank of England remains those factors contributing to underlying inflation. Consumer demand and labour market supply continue to ease, whilst wage inflation is now also showing encouraging signs of easing. But the improving trends are considered not enough to shift the stance on interest rates at this point. Further, service price inflation is still too high. These factors led the Bank of England to attempt to dampen expectations of a near term reduction in interest rates, no doubt conscious that such speculation itself leads to inflationary behaviour patterns. It wants to see a more consistent and broader picture of improving trends in the economic data. But despite its best efforts, most others are speculating that interest rates will fall sometime in Q3 2024 on current evidence.

“The continued impact of relatively high interest rates, necessary to bear down on inflation, will be a drag on published results in the forthcoming Q1 2024 results season and near-term growth prospects. Nevertheless, for many companies, there should be an increasingly favourable tailwind as economic indicator comparators ease alongside the start of a reduction in interest rates. This scenario would help management teams in their quest for growth, notwithstanding the fact that the age of cheap money is well and truly over for all.”

Puma’s AIM IHT Service seeks to offer investors the potential growth opportunities of a carefully selected portfolio of AIM stocks, combined with the benefits of IHT mitigation. The portfolio has an AUM of £194.4m and 90% of companies in the portfolio have a market cap above £100m.2  


1 The indices shown are for illustrative purposes only and are not considered directly comparable to the performance of this Service. Source: Iress. Past performance is no indication of future results.

2 Figures correct at 31 December 2023.

All performance data is quoted net of management and dealing fees and applies to actual initial investors’ portfolios that remain invested. Please note that performance data applies to the longest held, live portfolio which has been invested since inception, based on a portfolio managed directly by the Manager on its main trading platform. Performance data may vary for portfolios managed by the Manager on platform due to differing deal fees and other platform fees. Furthermore, small variations in performance may apply as each individual investor has their own discrete portfolio of assets. Discrete performance data is calculated as full-year periods from 1 January to 31 December of the year displayed.

Past performance is no guarantee of future results.

Date of inception: 1 July 2014.