The managers of Jupiter’s Primadona Growth investment trust have said investors should focus on equities because of the inflationary pressures being stored up by excessive monetary easing.
Richard Curling and Derek Pound, who run the £56m trust, said central banks globally – now including Japan – saw growth and reduced unemployment as “openly more important” than keeping a lid on inflation.
“In such an environment, we believe high quality equities offer an attractive option for those who seek long-term inflation protection, especially when compared to returns offered by supposedly ‘risk-free’ assets such as highly priced government bonds,” the managers said in the trust’s interim management statement.
But the managers acknowledged that the growing belief tail-risks were receding could be challenged.
“Any bouts of volatility in the coming months should give active investors chances to pick up carefully selected assets at attractive prices,” the managers said.
