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Investment trusts and funds to buy on the cheap

Markets are awash with opportunities for adventurous investors
Investment trusts and funds to buy on the cheap

Bleak as the current situation is, markets are awash with opportunities for adventurous investors. Indices are well off their 2020 highs, meaning that many popular shares and assets may offer potential entry points for those with a long investment time horizon and stomach for risk.

This is also the case with funds, few of which have escaped the coronavirus sell-off. Of the 4,236 funds included in Investment Association (IA) sectors, 3,953 made a loss in the first quarter of 2020, according to FE data. Just 283 funds, or 6.7 per cent of the total, ended the period flat or made a positive return. And less than a tenth of the 513 investment trusts included in Association of Investment Companies (AIC) sectors managed to avoid a drop in their share prices.

Some of these funds look particularly cheap: nearly 1,100 open-ended funds were down by at least 20 per cent over the first quarter and 278 investment trusts' share prices dropped by a fifth or more. So the coming weeks and months could be a perfect time to top up on favoured holdings or find good entry points for promising funds.

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