- Alpha Investment Trust screen is looking abroad
- India, Europe, energy and defensive asset allocation are themes
Looking beyond the headline grabbing political drama in the UK the economic situation is dire: inflation remains rampant and the outlook for growth is weak, so what are investors to do? Our trusts this month cast the net across the globe.
Energy, emerging markets and dynamic asset allocation
One of the goals Liz Truss set out when she began her short and ill-fated tenure as prime minister was to boost investment and growth in the British economy.. Instead, financial market participants saw through the gaping holes in the train-wreck of a fiscal plan and investor confidence in the UK plummeted, as evidenced by the spike in gilt yields and a collapse in the pound.
The Alpha Investment Trust screen has also given a vote of no confidence in Blighty, with the top 10 trusts this month overwhelmingly favouring overseas themes. For yet another month, investing in India has ranked highly with Ashoka India Equity (AIE) and JP Morgan Indian (JII) flagged. The latter of these two funds received a detailed write-up following last month’s investment trust report.
Energy remains a hot topic, politically and for investors, with two specialist trusts, Riverstone Energy (RSE) and renewables fund Harmony Energy Income (HEIT) making our list.
Looking at more mainstream investments, the focus has been overseas with JP Morgan Global Growth and Income (JGGI) and Baillie Gifford US Growth (USA) once again ranking highly. With perhaps some value opportunities on the horizon, stable-mates Henderson European Focus (HEFT) and Henderson Eurotrust (HNE) also make the top 10.
The two featured trusts here are another overseas play, BlackRock Latin American (BRLA), which offers investors exposure to one of the least bad regions this year and Personal Assets Trust (PNL), a flexible fund with an onus on dynamic asset allocation to protect wealth.
These are an interesting selection of choices. Discount-widening (with investment trust shares selling off by more than their underlying investments) is a risk in bear markets, but the themes in these funds can be bought into cheaply and a sensibly moderate level of exposure to some of them could offer investors good long-term returns, especially if the rest of the world fights back from recession faster than basket case Britain.
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