Terry Smith’s £24.1bn flagship strategy has started buying a new position, the name of which will not be revealed until Fundsmith has reached its desired weighting.
According to its latest factsheet, the top contributors for July were Amazon, LVMH, L’Oreal, Novo Nordisk and Microsoft. The biggest drags on performance Philip Morris, Meta Platforms, Kone, Alphabet and the latest unidentified addition.
July marked something of a change in fortunes for the equity fund, which has been steadily shrinking this year amid the tech rout.
At the start of 2022, Fundsmith weighed in at £28.9bn. Rough market conditions and redemptions saw this chiselled away to £22.7bn by the end of June. The rebound to £24.1bn at the end of July will no doubt be welcome news.
On a performance front, Fundsmith returned -11.8% over the year to 29 July, while its benchmark, the IA Global sector, delivered -8.6%.
While neither figure may appear much to crow about, they are improvements on the previous month, which saw the fund return -17.8% and the benchmark -14.1% over the first six months of 2022.
This year has been a busy one for Fundsmith, which jettisoned a long-standing stake in Johnson & Johnson in February and added positions in Adobe and Mettler-Toledo in April. May saw the fund sell out of Starbucks.
Over five years, Fundsmith has returned 74.3% against the IA Global’s 49.5%.
See also: Fundsmith handed clean sheet after section 166 review