Trustnet Magazine Issue 46 December 2018 | Page 36
In focus
[ 2019 OUTLOOK ]
34 / 35
Adam Lewis finds fund managers bracing themselves for an uptick in
volatility as he sums up the outlook for every regional investment trust
sector in 2019
The UK
Fasten your seat belts
I
nterest-rate rises and the
return of volatility were the
dominant themes in 2018.
After a period of calm, markets
plummeted in February, prompting
asset allocators to adopt defensive
positions. Closer to home, Brexit
uncertainty continued to abound,
leading to outflows from domestic
UK equity portfolios.
With these questions unresolved,
2019 looks set to be another eventful
year. So what are managers doing
with their portfolios and what are
the best investment trusts to help
you navigate the coming 12 months?
Heading into 2019,
Toby Ross, co-manager
of the Baillie Gifford-
managed Scottish
American Investment
Company (SAINTS),
says his focus remains
exactly where it was
in 2018 and the year
before: namely the
most resilient sources
of income and growth.
As a result, he is
concentrating less on
what is happening with
global monetary policy
FE TRUSTNET
and politics and more
on bottom-up stock
selection. SAINTS’
global mandate
means it can invest
anywhere in the world;
it currently has little
domestic UK exposure,
focusing instead on
large caps that derive
the majority of profits
from overseas.
“We own Admiral,
which has some
domestic exposure and
some international
earnings, but this is
not a stock which will
be driven by Brexit
concerns, because
Brexit will not make
a difference to your
decision about insuring
your car,” says Ross.
“However, more
generally we have more
money in more global,
high-quality UK growth
businesses, which
aren’t likely to get
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