Tag Archives: Senior Investment Manager

Chinese Shanghai Composite index falls 5.3% on Monday

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Recent actions by the Chinese regulators to curb lending has further unnerved investors already unsettled by recent comments from Ben Bernanke. The interest rates Chinese banks charge each other surged last week to record highs before falling back.  And following a recent statement by the People’s Bank of China, the Shanghai Composite Index fell 5.3% Monday night.

 

Adrian Lowcock, Senior Investment Manager, at Hargreaves Lansdown;-  

 

“China’s new leadership is addressing some of the risks that have been building up in the banking system, inevitably this could result in some short term pain, possibly impacting on growth but it should benefit China in the longer run.  Chinese stock markets do look cheap at present,  based on 20 years of information.   In addition it is important to remember that China is a state-controlled economy and therefore it is very difficult to make a clear judgement on the accuracy of the information being provided.   There are some concerns China’s shadow banking system will spiral out of control, however it seems unlikely the People’s Bank of China will let the system fail.“

 

“In line with their 5 year plan China is undergoing a change from an export driven manufacturer to a consumer focused economy. This transition is not going to be smooth and there will be some bumps along the way.  China continues to grow, at around 6 to 7% per annum, but like all emerging markets this does not lead to a smooth rise in the equity market.

 

In 2007 investing in China was very popular and as a result valuations rose to very high levels. The market has underperformed both developed and emerging markets since. There are clearly issues in China’s financial system and authorities are now taking action to deal with these. For long term investors that want to have exposure to China this setback could be providing an opportunity to invest. Company earnings are rising and valuations are looking much more attractive. Most investors can get sufficient exposure through a well-diversified emerging markets fund such as First State Asia Pacific Leaders which has 23.9% in the region or Aberdeen Asia Pacific which has 18.47% in the area.   For investors wishing to take a more adventurous approach and are able to tolerate a higher level of risk then Jupiter China, managed by Philip Ehrmann, provides exposure.”

 

Last minute ISA Ideas for 2012/13 Tax year

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·         ISA ideas for different types of investors

·         14% of all HL ISAs opened in the last week of the tax year

·         HL Opening Times

 

Adrian Lowcock, senior investment manager at Hargreaves Lansdown offers his ISA ideas as this year’s deadline approaches:

 

“In the last two tax years 14% of all new ISAs opened on the Hargreaves Lansdown Vantage platform were opened in the last week.  Make sure you take out your ISA as once the tax year ends you have lost that allowance. To take out an ISA all you need is your national insurance number, debit card and cleared funds in the bank.”

 

Income investor

 

Invesco Perpetual Distribution – This fund aims to provide a regular stable income this fund invests in a mix of bonds and income-producing equities. Approximately two-thirds is invested in corporate bonds with the remainder invested in equities. Income is its primary aim and it makes payments to investors monthly.

 

Defensive investor

 

Newton Real Return – This fund is for investors who may need access to some of their capital in the medium term (but still in at least 5 years’ time). It therefore tries to offer some sheltering of capital and aims for more modest growth. The manager invests in a variety of assets and uses sophisticated techniques to try to profit from assets which fall in value.

 

Medium Risk investor

 

Troy Trojan – This fund is defensively managed and provides the potential to achieve a reasonable level of return over the medium term with a little less volatility than the very long-term, more aggressive portfolios.

 

Long-Term investor

 

CF JM Finn Global Opportunities – This suggestion is for investors with a long time horizon.  Therefore the focus is on more risky areas with greater potential to build wealth over the long term.

 

Junior ISA / Investing for Children

 

Lindsell Train Global Equity – The managers invest in global equities and have a long term buy and hold approach. This compliments those investing for children who often have very long-term goals in mind.

 

 

Hargreaves Lansdown end of tax year opening hours

 

Monday 25 – Thursday 28 March                               8am – 7pm

Easter Bank Holiday weekend every day               9am – 6pm

Tuesday 2 April                                                                 8am – 8pm

Wednesday 3 April                                                          8am – 8pm

Thursday 4 April                                                                8am – 8pm

Friday 5 April                                                                      8am – Midnight

 

ISA deadlines

 

Stocks & Shares ISA

 

Online                   Friday 5th April – 23:45                                    www.hl.co.uk/ISA

Telephone          Friday 5th April – 23:55                                    0117 900 9000

Postal                    Friday 5th April

 

Bed & ISA

 

Funds on Vantage                           Wednesday 3rd April – 17:00

Shares on Vantage                          Friday 5th April – 12:00

Funds/ shares certificated           Wednesday 3rd April

ISA Contribution limits

 

                                  2012/13                                2013/14

 

Stocks and Shares ISA                    £11,280                                 £11,520

Junior ISA                                            £3,600                                   £3,720

A decade on since FTSE 100 hit bottom at 3,287

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A decade on since FTSE 100 hit bottom at 3,287

 

–       FTSE 100 returns 93% over 10 years

–       Technology sector is best performing returning 369%

Adrian Lowcock, Senior Investment Manager at Hargreaves Lansdown, looks at how investors have fared over the last 10 years.

 

In the last 10 years the FTSE 100 has risen 3,074 points or 93% since the low of March 2003, although it remains a little way off the high point of 6,732 reached on 15th June 2007.  Whilst the market has risen over the last 10 years there have been some big winners and losers during that time.  The Banking sector has been the worst performer over the last 10 years and the only sector to post a negative capital return with the FTSE All-share/banks returning -20%. The Technology sector posted the best performance with the FTSE All-share/Technology returning 369%, recovering from the lows seen in the years following the Dotcom bubble.

 

 

Performance of FTSE Sectors from 12 March 2003 to 28th February 2013

 

All Share Sector

% Growth
FTSE All-Share/Banks CR

-20.25
FTSE All-Share/Financials CR

22.81
FTSE All-Share/Health Care CR

78.02
FTSE All-Share/Telecommunication CR

100.11
FTSE All-Share/Oil & Gas CR

110.22
FTSE All-Share/Consumer Services CR

112.91
FTSE All-Share/Utilities CR

179.25
FTSE All-Share/Basic Materials CR

280.44
FTSE All-Share/Consumer Goods CR

346.31
FTSE All-Share/Industrials CR

360.45
FTSE All-Share/Technology CR

369.08

 

Adrian Lowcock says;-

 

“The technology sectors strong performance over the last 10 years highlights the contrarian nature of the stock market.  However, it is difficult for any investor to go against the trend and take such risks. Instead investors should focus on their long term investment goals and invest whenever they can afford to do so.”

 

“It is time in the market not timing that counts. Even though the FTSE 100 remains below its all-time high (6,930 on 30th December), if you had been invested all that time, with dividends reinvested, you would have been up 44.73%. In addition picking the right funds can transform your portfolio and make the nominal value of an index meaningless.”

 

Recommendations

 

Schroder UK Alpha Plus – Richard Buxton takes a long term view and is able to spot some opportunities before others – a distinguishing feature of all great investors.  Having the conviction to back them is equally important and Richard holds only 30-40 companies in his fund which means each idea has a significant effect on performance. You will never see his portfolio padded out with mediocre holdings just to make up the numbers. This fund has the potential to deliver superb returns, in a variety of economic conditions.

 

JO Hambro UK Equity Income – The managers believe the UK economy is performing better than most commentators expect. The fund continues to have a bias towards more economically-sensitive companies and has performed well recently as a result.