One year to the day since Americans took to the polls to elect their 45th President, Sheridan Admans, investment research manager at The Share Centre, outlines why he has added two funds with a focus towards the Americas to the Platinum 120.
Two ‘New World’ funds added to our preferred list
Columbia Threadneedle US Equity Income fund
Suitable for investors seeking large and mid-cap equity income exposure from the US who believe the economic expansion story has some way to go.
The US economy represents roughly 20% of the worlds output. The economy is dominated by service led businesses but surprising to some might be the fact that the US is the second largest manufacturer in the world, producing such items, as automobiles, farm and industrial machinery, aerospace, chemicals and telecommunications. The US economy, much like other developed market economies, has been recovering slowly from the stock market crash of 2008. The recovery has involved the US Federal Reserve (FED) supporting growth and consumer indebtedness with ultra-low monetary policy, including setting the base rate near zero for almost a decade. These policies have supported significant improvement in the US jobs market and pushed up asset prices, and subsequently companies look in good health.
Fund manager Nadia Grant aims to provide income with a preference for companies that are growing their distributions, which have the potential to grow the amount you invested.
Many of the top 10 holdings within this portfolio at present are large multinational names who generally are familiar to us in our everyday lives such as Apple, Microsoft, Cisco, Pfizer and Johnson & Johnson. The fund has larger positions in Consumer Staples, Energy and Real Estate, the latter is an area of which Grant has a solid background, which goes to support the higher index weighting in the fund.
Neptune Latin America fund
Suitable for investors seeking exposure to Latin America, who have a long-term outlook on the regions potential for growth and are comfortable with volatility.
Latin America is one of the most dynamic emerging markets but historical political challenges combined with subsequent economic woes have meant investors have naturally been wary of exploring opportunities within the region. We believe however, that things are turning around and therefore the longer term outlook is improving.
The Neptune Latin America fund provides investors with an opportunity to invest in a region with an exciting future; favourable demographics, a growing middle class, political reforms and a global dominance in the commodity sector. Thomas Smith has managed the fund since 2009 and his objective is to offer investors diversified exposure to Latin America. At present, holdings are primarily concentrated in Brazil and Mexico with additional positions in companies based in the smaller economies of Chile and Peru. The fund has an off benchmark position in Argentina, an economy which is currently a frontier market but likely to move to emerging market status in 2018, and which is currently demonstrative of many of the key positive trends at work in Latin America.
All information given including prices, yields and our opinion is correct at the time of publication. Our opinions on investments can change at any time and for our latest view please go to www.share.com. To understand how our Investment research team arrive at their views please read our Investment Research Policy.