Pictet Global Megatrend Selection Fund Update
By Mark Hoskin, IFA at Holden & Partners
22 September 2011 | Fund News | Comments (0)
Hans Peter Porter points out that 7 of these 9 megatrends have outperformed the MSCI World index since launch, with only Biotech and Clean Energy underperforming. While Hans uses the MSCI World index to explain performance he says that actually there is only a 10% overlap with the stocks in the index. The fund has underperformed in 2011 because the fund is 50% exposed to small and mid cap stocks and has a 20% exposure to emerging markets. He points out that relative to the index the fund will continue to be overweight in healthcare companies and underweight in financials.
However Hans goes onto say that with "little cyclical growth this fund will continue to do better" than the MSCI World index. In the year to date Timber and Clean Energy have also been a drag on performance. The weak US housing market continues to impact on demand for timber, while the economic slowdown in Europe weighs on paper and pulp demand. Austerity measures continue to impact on clean energy, with many companies in this area reliant on government subsidies for their end market.
Hans points out that Water, Biotech, Generics, Digital Communication and Security will tend to move in line with the markets (low beta), while Clean Energy, Timber, Agriculture and Premium Brands will be more volatile and he describes as "racier versions of the themes".
Hans maintains that the key differentiator for this fund is the fund managers' focus on "one value chain" in each sub theme. Each fund manager knows "a lot about a little" as opposed to most other global equity managers who know "a little about a lot". The fund weightings between each sub theme are managed passively, with rebalancing between the themes automaticly undertaken and not subject to opinion. Thus this fund relies on the decisions of 17 investment managers as opposed to 1 or 2 and will invest in up to 500 stocks at any one time as opposed to say 100.
Get investment advice
Speak to a specialist adviser for help in choosing the right green or ethical investment.
or call 020 7812 1460
Mark Hoskin is a Partner at Holden & Partners. Holden & Partners are Chartered Financial Planners who provide financial advice to high net worth clients, the majority of whom have a significant interest in ethical or environmental issues.
Mark Hoskin graduated with a History degree from Keble College, Oxford and went on to become a Chartered Accountant with Price Waterhouse. He cofounded Holden & Partners in 2003 and is a Certified Financial Planner and Chartered Financial Planner. Holden & Partners set up Worldwise Investor to help both advisers and investors understand quickly and easily how they can benefit from ethical and environmental investment in the UK market.
News keyword search
News by category
News by month
News by author
And so now the FSA are looking to ban UCIS for retail investors. See The soft closure of the two First State Funds does not mean they are completely closed to new... The Multi-Asset approach seems to be a sensibel approach. Our view is that multi-asset investing is a very different discipline to long-only equity (which is... Has the same sort of definition slipping also happened to Jupiter Ecology? I hope not.
There looks to be quite a...
The soft closure of the two First State Funds does not mean they are completely closed to new...
The Multi-Asset approach seems to be a sensibel approach.
Our view is that multi-asset investing is a very different discipline to long-only equity (which is...
Has the same sort of definition slipping also happened to Jupiter Ecology? I hope not.
The value of ethical and green investments can go down in value as well as up, so you could get back less than you invest. It is therefore important that you understand the risks of investing. Our aim is to provide you with the best information we can to help you make decisions about ethical and green investments. It is not to advise you on the suitability of an investment to your personal circumstances. Nothing written on the site should be considered personal advice, nor do Holden & Partners accept liability for any inaccurate information on the site. If you are unsure about the suitability of an ethical and green investment please contact Holden & Partners or your financial adviser.