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IFA reaction: Fund selection
With markets still looking uncertain, which funds do advisers trust to deliver returns irrespective of market conditions? Oliver Good asked seven leading IFAs for their views.
Kelvin Lillywhite, Best Advice Financial Planning
“Investors are finding it harder to get returns from a traditional balanced portfolio, so we have been re-arranging the asset allocation by adding commodities exposure. A very good fund for this is the £1.9bn JPMorgan Natural Resources fund. We have been cutting traditional equity exposure in favour of funds like this, as well as increasing cash and fixed income to compensate for the increased risk. It is quite difficult to get direct access to commodities without going offshore. This fund invests in companies that are involved in commodities, so it is an equity portfolio, but a pure commodity play. The figures speak for themselves, the fund has returned 32 per cent over one year by investing in gold and precious metals. It is also top quartile over one, five and 10 years.”
Ben Yearsley, Hargreaves Lansdown
“I have never been a big fan of bond funds, but in recent months my attitude has totally changed. The sector has been absolutely hammered and they are looking incredibly cheap. My favourite at the moment is Invesco Perpetual’s £1.8bn Monthly Income Plus, which is yielding about 8 per cent. In fact the way things are going there is the potential for a double digit return over the next 12 months. Bonds are yielding a lot and there is the potential for capital growth as well. This fund is particularly appealing because of the managers Paul Causer and Paul Read, who are both very good. There is also a 20 per cent chunk of the portfolio which is in equities and that is managed by Neil Woodford.”
Melyvn Bell, Lowes Financial Management
“We have been using the £1.8bn Jupiter Merlin Income Portfolio on a consistent basis. The managers have done an excellent job. Algy Smith-Maxwell, Peter Lawery and John Chatfeild-Roberts have all managed the fund since launch in about 1997, which is positive. The multi-manager portfolio is something we like - with markets the way they are, helps having that extra layer of risk diversification. It is fairly actively managed but does not take on a lot of risk, it just adds value on a consistent basis. Consistency is critical, you want people you can feel confident about in all market conditions.”
