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One big success story has
been the environmental
sector, which has posted
average gains of 27.46 per
cent, making it the fifth best
performer overall
Global, North America and Japan
counterparts this year.
“Anything UK is really suffering due
to the Brexit factor,” Carthew adds.
“Most managers have been pragmatic
and focused on global companies
earning non-sterling income, but
those that have stuck to their guns,
like Mark Barnett, have really been
carried out.”
Some relief may be on the way,
however, with a Conservative
landslide in the general election
providing support.
Sarah Godfrey, investment
company director at Edison, says:
“The UK has been horribly out of
favour with international investors
and as a result looks much better
value than other markets, with a
forward P/E only 1 per cent above the
10-year average. The market seems
to have begun to price in an end to
Brexit uncertainty, however.”
Across the channel, European
trusts have enjoyed a much
stronger year, posting returns
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just behind their US peers even though
the continent’s biggest economy –
Germany – has been teetering towards
recession. Godfrey adds: “Europe is
a funny one – it’s up circa 20 per cent
year-to-date on not much in the way
of good news. I think it has been quite
polarised, with the quality,
growth and momentum
strategies doing well, while
more value-focused ones
have suffered.”
Energetic tailwinds
One big success story has been
the environmental sector, which has
posted average gains of 27.46 per cent,
making it the fifth best performer
overall. This is not likely to be a
transient theme as, says Carthew,
there is now “widespread recognition
that we need to start spending some
money to sort the climate out”.
This year saw the launch of two new
trusts focused on renewable energy:
US Solar and Aquila European
Renewables Income. The latter is
tapping into the strong income
available in the sector.
Slater says: “Investors waste a lot of
time trying to predict the outputs of
complex systems like the economy
and politics. What we can have an
edge in is predictable variables.
The declining cost of solar energy
and energy storage has been fairly
predictable and will continue to give
rise to opportunities.”
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