Canaccord Genuity  

Why it's worth expanding your clients' investment horizons

Why it's worth expanding your clients' investment horizons

When the world’s most successful companies have spent decades, and in some instances centuries, building top quality global franchises, why would you only invest in companies listed on your national exchange?

Instead, shouldn’t we be exploring many more opportunities to invest in successful and growing businesses, which might be listed beyond our domestic shores? 

After all, from a UK investor’s perspective, why only look at BP and Royal Dutch Shell in the energy sector, when Chevron or ExxonMobil in the US might be better ways to invest in oil?  

Or in pharmaceuticals, why only look at GlaxoSmithKline and AstraZeneca if there are better opportunities in Roche or Novartis in Switzerland? All these companies, UK listed or not, view the world as their market and invest their capital accordingly. 

Yet this view feels contrary to the recent groundswell of popular political opinion against globalisation. Take Brexit in the UK, the rise of unorthodox political parties across Europe and Donald Trump’s populism in the US, to name but a few.

However, here at Canaccord Genuity Wealth Management, we remain firmly of the view that truly global, trailblazing companies create products and services that have world-wide appeal and will be in demand, irrespective of whatever impediments might be placed in the path of free trade by governments.

Likewise, no amount of trade barriers or other forms of protectionism can make an uncompetitive steel company, national airline or car manufacturer an attractive long-term investment. 

Simply put, there are too many brilliant companies in the world to invest only in companies listed and trading in a single country. 

As an investor in the UK market, it is almost impossible to gain exposure to car companies, the forestry sector, large mechanical engineering firms or to major chemical companies – they are just not represented in the FTSE.

If your portfolio is focused on the continental European stock markets, it is difficult to invest in the global mining sector. If you wish to invest in technology companies, the bulk of the most successful firms are listed in the US. 

The challenge for investors, wherever they are based, is to expand their horizons beyond their domestic markets – and take advantage of these global operations.

No easy task with such a big universe to choose from, different regulations, political challenges and economic divergence.

The Canaccord Genuity Wealth Management (CGWM) Global Equity Fund offers investors a diversified portfolio of equities from a variety of sectors from anywhere in the world.

With insight provided by Quest®, an equity evaluation system and analytical tool which covers approximately 8,500 companies equating to 95 per cent of the total global equity market, we identify high quality, globally diverse companies that are trading at a reasonable price.

Over the longer term we believe that this combination of quality, value and global diversity should continue to deliver consistent superior returns for our clients.

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