JIC Weekend Update: A tough week

John Rosier
4 days ago
3 min read

**UK Government Borrowing costs rise again. 10-Year Gilt highest since 2008. Sterling crisis imminent?**

Last week was marked by a significant "risk-off" rotation as the Middle East conflict entered its third week. The combination of surging oil prices (Brent over $110) and a hawkish shift from central Banks, including the Bank of England, put intense pressure on both gold and growth equities.

Performance update

The JIC Portfolio fell 3.2% last week, while the FTSE All-Share was also down 3.2%.

YTD, the JIC Portfolio is up +7.8%, All-Share is up +0.1%.

The Funds' Portfolio fell 2.6% last week, while the FTSE All-World (GBP) was down 2.2%.

YTD, the Funds' Portfolio is up +3.9%, and the All-World (GBP) is down -1.8%.

Key Market & Portfolio Drivers

The Energy Surge: My exposure to the energy sector provided a much-needed hedge. Venture Global (VG) was the standout performer, jumping 20.4% this week (although only 5.2% since I bought the position on Thursday), following a major $8.6bn financing package for its CP2 facility. International Petroleum Corp (IPC) and Frontline also went up, 7.3% and 6.6%, respectively, as the Strait of Hormuz closure continues to choke global supply.
The Gold Correction: It was a brutal week for gold miners. L&G Gold Mining ETF fell 14.1%, while individual names like Lundin Gold (-8.9%) (a new position in the JIC Portfolio) and Ngex Minerals (-11.2%) were hit hard. This wasn't just a flight from risk, but a flight to liquidity—investors sold liquid gold positions to cover losses elsewhere as the US Dollar strengthened.
Interest Rate Reversal: The Bank of England held rates at 3.75% this week but turned hawkish, with Governor Bailey noting that the "oil shock" could force rates higher later this year. This sent the UK 2-Year Gilt Yield up to 4.6% and the 10-year yield to 4.9%, its highest since September 2008. This weighed heavily on my market-sensitive holdings, such as Polar Capital (-3.9%).

Electricity and gas bills are going up - whether it makes sense to take more money out of people's pockets through interest rate increases, I'll leave to you to decide. Another policy error in the making?

Recent Transactions

I have been rebalancing to manage volatility and lean further into the energy and metals themes:

JIC Portfolio:
- Buys: Added new positions in Venture Global (VG) and Lundin Gold (LUG) and added to existing positions in Ngex Minerals (NGEX) and Pollen Street (POLN).
- Sells: Traded in and out of Var Energi (VAR) for a profit of £4,098 and reduced Polar Capital (POLR) to 3.0%, booking a profit of £4,212.
Funds' Portfolio:
- Buys: Increased the position in L&G Gold Mining ETF (AUCP) on the dip, adding 59 shares across two trades on the 18th and 19th of March.

Current Portfolio Snapshots

JIC Portfolio: Now holds a 7.1% cash balance (£62,304), providing dry powder if the market correction deepens. The top holding remains BH Macro (10.5%), acting as a volatility hedge.
Funds' Portfolio: Remains fully invested with Argonaut Absolute Return (11.9%) and iShares Energy (11.1%)as the largest positions, balancing defensive "absolute return" goals with the current energy tailwind. BH Macro is 10.8% of the Funds' Portfolio.

Gold Miners look very oversold to me, with the RSI at levels it has usually traded up from. Hence, my adding last week.