The company’s immediate response to the volatility was to reduce its core holdings in UK equities to underweight positions as it took a cautious view on the asset class.
It also let cash levels in its portfolios accumulate to 6-7 per cent and began buying short-dated gilts as it felt this area of the gilt market was more attractive than equities.
Mid-way through August, Midas started to bring its UK equity exposure back up to the neutral position. Although there remained an element of doubt and uncertainty in the markets due to the credit crunch, it felt UK equity valuations had reached levels that the firm viewed as attractive.
Head of business development David Thomas says: “Having taken a more cautious stance in recent weeks, we have now taken advantage of market falls to add selectively to our UK equity weighting in blue-chip stocks.”