New inflection points ahead

April saw a sharp improvement in global risk sentiment. Optimism around an Iran-war resolution and resilient economic growth prompted a strong re‑rating of growth and innovation‑led equities. Crypto, Technology and AI‑exposed sectors led the advance as investors refocused on secular tailwinds and long‑term productivity gains, resulting in one of the strongest monthly performances for U.S. equities in recent years and a broad resurgence in risk appetite.

Market Outlook

We are surprised how sanguine markets are in pricing the current geopolitical situation. Other than some commodity markets, e.g. Oil, most major asset classes such as equities have recovered or even exceeded pre-Iran war levels. And even on a forward-looking basis, implied volatilities are at or close to pre-war levels (see chart on equity vol).

We believe the situation is long from resolved and therefore remain as cautious as possible in the equity sleeve of our funds by tilting weights towards attractive valuations and emphasizing quality- over highly speculative businesses.

Interestingly crypto assets currently exhibit lower daily volatilities as some single name equities, which underscores our thesis that “the worst is behind us” for crypto assets as they tend to price-in regime shifts with a 6–9-month lead time. Notably, crypto assets’ macro sensitivity has materially shrunk since the Iran war, making them volatility buffers rather than amplifiers in frontier tech- and high beta portfolios.

Lastly, we highlight that the CLARITY Act in the US is entering its final stages, with Coinbase, one of the leading crypto activists, expressing support for the latest markup. The bill clarifies rules for crypto firms, especially regarding stable coin rewards, and marks another catalyst forward. Bloomberg currently estimates the probability of the bill passing this year at 60%. We believe with Coinbase’s endorsement, the likelihood is higher than that.

Portfolio Updates

On 1 April we launched our new tech equity strategy in the Digital Technologies Fund. The pivot towards a hybrid of blockchain and blockchain-adjacent categories reflects our conviction that we are entering an inflection point in digital asset markets, as we observe the rapid convergence of the blockchain tech stack with traditional capital markets.

Against this backdrop, the portfolio rose +17.7% over the reporting period despite temporary cash allocations, benefiting from its exposure to digital asset infrastructure and technology‑enabled financial platforms. Performance was led by Galaxy Digital (GLXY, +70.6%), Keel Infrastructure Corp (KEEL, +56.8%), and CleanSpark (CLSK, +37.1%), reflecting renewed engagement toward infrastructure plays. Mastercard (MA, −0.7%) was the only holding that detracted in a period dominated by higher‑beta exposures. Overall, the portfolio’s posture toward higher‑conviction segments of financial and digital infrastructure benefited performance relative to market. Despite the volatility in these market segments, we are optimistic that secular growth tailwinds will continue to lift these assets higher over time. But we emphasize patience and a long-term allocation strategy!

Despite its growth equity and tech exposure, our selective approach still results in a portfolio with attractive valuations relative to broader tech indices, with a ~40% discount in the EV/Sales ratio. Considering the CAGR of sales growth of over 25% p.a. of the total portfolio, we are comfortable with the underlying fundamentals of our single name equity selection and actively expanding the book into new opportunities.