For those of you who have invested in equities and commodities, the recent few weeks will have been a stressful time. As always, we are bombarded with comment after comment, opinion after opinion and, ultimately, who is to blame for what?
One minute it is down to interest rates in the US, the next it’s China and lower growth expectations. Oil has continued to fall and gold doesn’t seem to be doing a great deal. The normal sign of a bear market is a rush to gold, which has not happened.
For me personally, I think it is neither a bull nor a bear market – it is merely volatile.
With volatility comes opportunity.
Who do I believe?
Not an easy task this. More often than not you have to get past the ‘white noise’ and talk to some of the professionals and then place your trust.
I was in London recently visiting the offices of Quilter Cheviot, 1 Kingsway. David Miller, lead fund manager of the Nexus Global Solutions Portfolio, was on hand to take us through the ups and downs of the market, whilst allowing us to observe how his portfolio managed to ‘preserve’ wealth during this volatile time and even look to gain. Not an easy task!
QC takes a view that you should not necessarily look at the macroeconomics of things – so the bigger picture. You have to look at the component parts when stock selecting and really look under the bonnet of the individual companies.
For those of you who have been sat on tracker funds over this period, wow, what a ride! Tracker funds are recommended/sold because they are supposed to be a cheap solution at following the market – and boy do they just do that! Is that what you really wanted, to follow the market down?
QC sat back and looked at how much cash they were sat on and considered which stocks looked even cheaper and likely to bounce back – but based on true economics and knowledge of the asset. For example, they added to their weighting of Apple and also of BAT – both stocks recovering extremely well when the jitters stopped.
So whilst investors, professional and retail, get scared and head for the door, there are those who step back, review, re-visit and make informed decisions on where the value actually lies.
How did they do?
Well if you were sat in a FTSE100 tracker, you would have seen the value of your money reduce by some 6% on the year. The Nexus Global Solutions Portfolio managed by Quilter Cheviot was off less than 1% on the year.
Whilst the portfolio is more expensive to run than a tracker, here is where we can demonstrate the added value.
We have seen this last week – the FTSE100 back up to 6300 from its low point of 5800 in recent weeks. So those bold enough to have used their cash to purchase stocks at those prices will be smiling today.
It is clear to me, more and more each day, that I am no expert in selecting funds or stocks and that’s the general consensus of the firm I represent.
It is far better to place your clients’ hard-earned wealth in the hands of experts. Find the right company and place your trust in them.
As Blacktower enters into its 30th year of trading, we have worked with many a life company, fund house and discretionary fund manager – and have built up trustworthy relationships with all.
You place your trust in us as we do in them in order to preserve your wealth and make it grow for you.
By Robert Mancera
Robert Mancera is GM/Director at Blacktower Financial Management (International) Ltd with offices in Quinta do Lago and Cascais. 289 355 685
Blacktower Financial Management (International) Ltd is licensed by the Gibraltar Financial Services Commission Licence 00805B