Most would say this is a bad time to launch an investment competition. I don’t agree. Stockmarket falls in the last month were a certainty after the huge gains over the last fourteen months. At times like this opportunities come along for savvy investors.
There’s bad news aplenty - Greece and Spain for a start, oil disaster in the Gulf, rumblings from North Korea and the Middle East - but it’s at times like this value’s created.
But, investors shouldn’t lose sight, the World economy, thanks to developing countries, will continue to grow. Developing countries are in a secular bull market, even though the developed West isn’t.
We believe the Commodity demand theme is intact and exploding middle classes in developing countries will increase demand for consumer services and products. The US is in good shape and it’s stockmarket is cheap on any basis. But it’s likely to be a bumpy Summer as we predicted earlier.
Unlike the pessimists, I reckon by late September it will make sense to be 100% equities, 75% International, 25% UK. But I’d buy gradually – 33% now, then in July/August on bad days, and finally towards late September.
Commodity funds like JPM Natural Resources should be in the team as well as Asia funds from Neptune and First State. A decent US fund from Schroder/JPM makes sense, but my midfield general would be Graham French at M&G Global Basics.
For UK exposure, I’d add some old heads with great records such as Tom Dobell and Harry Nimmo, and in goals the likes of David Jane or Neil Woodford.
I appreciate this view won’t suit economists but when have they ever been right?
Written for The Telegraph Fantasy Fund Management Competition. An edited version of this article with Alan Steel's suggestions appeared in The Telegraph on Saturday 5 June 2010
