Investors exit safe assets after Trump victory

twitter-iconfacebook-iconlinkedin-iconmail-iconprint-icon
Search supported by
Investors exit safe assets after Trump victory

The flight to ‘safe’ investments following the US election reversed swiftly, as figures from QuotedData revealed which investment trusts have been hardest hit by Donald Trump’s win.

The worst performing investment trusts last month were those invested in gold, including the Golden Prospect Precious Metals fund and the UIL trust, which saw prices tumble 25 per cent and 16 per cent respectively.

According to QuotedData the initial flight to safety after the US election result reversed quickly, with the price of gold plunging.

Emerging market and Asian trusts were also badly affected by fears Mr Trump might instigate a trade war, with Latin American investments – including JPMorgan Brazil and the BlackRock and Aberdeen Latin American funds – falling out of favour.

Markets seem to have adopted a possibly illogical stance that his policies will be good for the US economy QuotedData

Trusts which invest in the Indian markets also had a tough time, but part of this is down to the uncertainty created by the government’s abrupt move to withdraw most of India’s bank notes from circulation in a bid to curb corruption. 

Investment managers think this will be very positive in the long run but in the meantime India Capital Growth and JPMorgan Indian are suffering, having both fallen nearly 13 per cent in price terms over the month.

The worst performing funds in price terms in November were: 
 (%)
Golden Prospect Precious Metals-24.9
UIL-16.9
Aberdeen Latin American Income-15.5
JPMorgan Brazil-15.4
Green REIT-15.2
BlackRock Latin American-14
Pacific Horizon-14
JPMorgan Indian-12.7
India Capital Growth-12.6
Schroder European Real Estate-12.5

The monthly report from QuotedData pointed out that markets seemed uncertain of how to react at first to the US election result.

But the research provider said now markets seem to have adopted a “possibly illogical” stance that his policies will be good for the US economy while being bad for global trade.

With this in mind, the investment companies which did well in November were US-focused trusts, such as the Jupiter & JPMorgan US smaller companies funds.

Biotech also did well as the threat of pricing controls in that industry receded, benefitting Biotech Growth and International Biotechnology.

Meanwhile the best performing trust in price terms was Dolphin Capital, jumping by a third after it improved it balance sheet by selling one of its properties to hedge fund Third Point.

The best performing funds in price terms in November were: 
 (%)
Dolphin Capital33.3
Polo Resources17.5
Lindsell Train14.4
Biotech Growth12.4
Alpha Real Trust10.9
BH Macro (GBP)10.8
F&C Commercial Property10.1
Industrial Multi Property9.9
Polar Capital Global Financials9.6
JPMorgan US Smaller Companies9.1