Good morning!

I have a flight this afternoon, so I apologise in advance for comments which will be more brief than usual.

Some announcements which have caught my eye:

  • Record (LON:REC) - Q4 trading update. Reduction in AUM-equivalent (I hold).
  • Bonmarche Holdings (LON:BON) - trading update. FY 2018 (ending in March) is in line with expectations.
  • Distil (LON:DIS) - trading update. FY 2018 (also ending in March) in line with expectations.

There's not much else to report in small-cap land, apart from a tiny subscription for new shares at the struggling tiddler Mobile Streams (LON:MOS), and a start date set in stone for the new CEO of Revolution Bars (LON:RBG).

In big-cap land, I'm scratching my head a bit over the tobaccos. I have accumulated a position in British American Tobacco (LON:BATS), whose share price suffered yesterday after weaker-than-anticipated results from Philip Morris (US:PM). I need to do more work monitoring developments there, when I get some time.

Record (LON:REC)

  • Share price: 44p (-10%)
  • No. of shares: 199 million
  • Market cap: £88 million

Fourth Quarter Trading Update

Please note that I own shares in REC.

There is no doubt that this is a disappointing update. Reading through, there are only one or two snippets of positivity.

Record is a specialist asset manager which focuses on currency management - helping clients to hedge their currency exposure, using simple or active strategies to boost returns.

Unfortunately, the high-margin product, Dynamic Hedging, isn't growing. Assets under management (using the method to calculate this for FX) for this category has fallen from $4.5 billion to $4.3 billion during the latest quarter. 

A year ago, this product had $6.3 billion in AUM-equivalent.

This is the service it provided to clients during the quarter:

The Dynamic Hedging programmes performed as expected, and low hedge ratios in line with US dollar weakness allowed US investors to keep currency gains in the underlying assets.

Leaving the Dynamic Hedging product aside for a moment, returns in the Multi Strategy product were negative during the quarter. Over the long-term, it has…

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