The market remains anxious, will the recovery continue? How will the rapid spread of the delta variant affect and how quickly will inflation fall? The positive market view has so far won this year with cyclical stocks at the top.
However, we are a little worried that the recovery may be delayed given the spread of Delta covid. Growth for technology stocks has been strong this year driven by investments around covid but also to make companies more efficient in this new environment.
Video games have been by far the weakest tech sector over the summer, driven by political pressure in China and tough numbers to compare to last year. However, the underlying demand has remained good and the autumn looks set to be strong driven by new releases. The large number of new releases will drive demand but also increase competition.
The strength in demand during the quarter came from all sub-segments: PC, mobile and console games. The esports part has been negatively affected by covid, but even there it looks a little brighter now. We expect a strong recovery in Esports when live events open up again.
We increased our position in Zynga during the month.
The fund ended up 3,14% in August and is now up 14,85% for the year.