Huge upsurge in the value of index-linked bond funds

Huge upsurge in the value of index-linked bond funds By Nick Sudbury Recent analysis by the Wealth Club showed that the best performing area of the market in August was the UK Index-Linked Gilt sector with an average return of 10.52%. This was home to the five best performing funds, which all rose by more than 12% in the month. The jump in value in August enabled the UK Index-Linked Gilt sector to be the second strongest area of the market over the last 3 months with an amazing gain of 20.9%. It had also done well previously and has become the most successful part of the fixed income universe over 5 years with a gain of 67.4% – despite the persistent lack of inflationary pressures in the UK. It is likely that the recent surge was a result of Brexit, as the sharp fall in the value of the pound will make imports more expensive when translated into sterling, although this assumes that the exchange rate will not bounce back. The subsequent reduction in interest rates by the Bank of England and the resumption of Quantitative Easing to help stimulate the economy was also a significant factor. The longer term performance could be due to the fact that professional investors have bid up their value to protect themselves against the return of inflation, even though there are no real signs that this is imminent. There is a school of thought that the monetary easing by the central banks will eventually result in rising prices, but the high level of debt will make it extremely difficult for them to increase interest rates to get things back under control… Click Here To Read The Full Story The Master Investor Market Report The FTSE 100 closed the day at 6,826.05, a decrease of 53.37 points. The FTSE 250 fell 22.53 points to finish at 18,003.44. The FTSE All Share dropped 24.24 points to finish at 3,726.47. The FTSE AIM All Share climbed 2.33 points to finish at 797.52. Housebuilder Berkeley (BKG) said that it would enter the 2016/17 financial year with forward sales worth £3.25 billion and a land bank margin valued £6.15 billion. As a result of this, management believe they are in a good position to reiterate Berkeley's commitment to deliver pre-tax profits of £2 billion by April 2018. However, the company did flag that building in London was becoming increasingly difficult due to conflicting government policies. The shares climbed 93p to close at 2,783p. Don't miss our September issue! Click HERE to read. Meanwhile, FTSE 250 developer Redrow (RDW) increased its revenues for the year ended 30th June by 20% to £1.38 billion. Profits before taxation also climbed by 23% to £250 million as average selling prices and operating margins improved significantly. The company said that demand was strong with the Government's Help to Buy programme attracting new buyers. The shares rose by 8.9% to 418.50p. AIM-listed software and consulting outfit Kainos (KNOS) saw its shares climb by 13.75p to 170p after it said it was on track to meet full year expectations. The company won a number of new public sector deals with the Home Office as well as a number of local government bodies during the five months ended 31st August. Tomorrow's news today Barratt Developments (BDEV) and Hargreaves Lansdown (HL.) will release final results. Quote of the day "Adapt Or Perish." - H.G. Wells Latest Stories Chart of the Day: Pantheon Resources By Zak Mir On the face of it, at least from the perspective of a non oil industry expert, the decline in Pantheon Resources was overdone. However, it may be the technical / charting position which investors should take note of… Click Here To Read The Full Story How to profit from Gold with a Binary Option By Vince Stazione A binary option allows you to profit from a financial market going up, down or even sideways – all with a strictly limited risk and with small stakes... Click Here To Read The Full Story Here's where the Fed is getting things wrong By Samuel Rae The US interest rate is the hottest topic in global finance right now, and as a forex trader, however tedious it has become to continuously read seemingly ill advised predictions, it has become impossible to avoid. Everybody is at it… Click Here To Read The Full Story Chart of the Day: UK Oil & Gas By Zak Mir Horse Hill has been such an epic story of billions of barrels, ramping, counter ramping, and intrigue that one would consider the whole situation as being a little too exciting for most small cap punters… Click Here To Read The Full Story The FED loses momentum again with 'Dusty' jobs report By Filipe R Costa After a quiet August, we are back to business as usual, which is 90% about following central banks and 10% about following everybody else. Almost one decade after the peak of the financial crisis, global markets still rely heavily on central banks… Click Here To Read The Full Story Join the movement on social media: Copyright 2016 Master Investor Ltd, All rights reserved. You are receiving this email because you opted in at our website. If a Daily Bulletin is too frequent, why not opt in to our once weekly mailing list for a round up of the week's news straight to your inbox. 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