James Thomson (pictured) has said he is positioned with 20 per cent of his Rathbone Global Opportunities fund in more defensive stocks.
He recently bought into a European nursing home business as he sought companies for his portfolio “not closely tied to the economic cycle”.
The manager warned with the leading indicators weakening, the world “economically, could be in store for tougher times”.
Speaking to FTAdviser, Mr Thomson, whose fund recently exceeded £1bn in assets under management, favours “under the radar and out of favour” growth companies and confirmed he was fully invested with 60 holdings and “almost no cash” in the fund at 3.09 per cent.
He admitted he was still “smarting” from the fund’s performance in 2016, which was up 16 per cent but “should have been up more”.
Mr Thomson said the reason the portfolio “struggled” was due to the areas he did not own, such as commodities and banks, which performed well.
The manager confirmed he took the fund’s weighting in the UK down from 25 per cent to just over 10 per cent following the EU referendum result last June and said he was “right to minimise UK exposure” as he suggested the UK “will be under a cloud”.
He has been putting more money into Europe and the US in place of some UK holdings, taking his US exposure up to 60 per cent of the portfolio and 25 per cent in Europe, with only one holding in Asia – China’s Tencent.
On a recent trip to the US, Mr Thomson visited three of his largest holdings in the Global Opportunities fund – Amazon, Facebook and Align Technology.
Amazon is the largest holding in the portfolio at 2.54 per cent, followed by Facebook which accounts for 2.52 per cent, while his holding in Align is 2.29 per cent.
He said one “leg of growth” for Facebook would be to monetise WhatsApp – the chat app which was bought by the social media giant in 2014.
In the 12 months to 4 May 2017 the fund has returned 28.9 per cent, in line with the IA Global sector which delivered an average 28.5 per cent return, according to FE Analytics.
The fund’s performance is comfortably ahead of the peer group over three years to 4 May, having returned 65.8 per cent in that period, compared to the sector average of 43.1 per cent.
eleanor.duncan@ft.com
