From innovation to income: six funds for your ISA portfolio

FundCalibre hosted one of its popular ‘speed-dating’ events last week – but, as usual, romance wasn’t on the agenda, despite the date…

Instead, we invited six financial journalists to have ten-minute interviews with six Elite Rated fund managers. While the journalists concentrated on getting their investment scoops, we took the opportunity to ask the managers a very simple question: why should I include this fund in my ISA?

Here are six funds, each offering unique strategies and opportunities, to consider for your ISA:

Going global

Capital Group New Perspective

Co-manager Julie Dickson emphasises the fund’s adaptability to evolving global trends. “This fund is able to adapt to changing environments over the long term. With a 50-year track record in global equity, the fund has recently focused on sectors like healthcare, artificial intelligence (AI), and industrials. By investing in companies with substantial growth potential, the fund aims to remain relevant across various market cycles.” 

The fund invests in both early-stage businesses and established multinationals. Its unique multiple manager approach involves nine portfolio managers, as well as a team of research analysts, contributing ideas.

Read more: Equities that thrive on global change

Guinness Global Innovators

Matthew Page, co-manager of the fund, highlights the fund’s concentration on companies at the forefront of innovation. “It’s a fund full of exciting growth themes,” he states, similarly pointing to sectors like healthcare, robotics, and AI.“This fund is positioned to benefit from significant technological disruptions,” he notes. 

With a concentrated portfolio of 30 stocks, balancing growth prospects with risk management. The managers of this fund have identified nine core innovation themes through their research. These themes range from advanced healthcare to artificial intelligence to big data. Innovation is a multi-year investment journey, and patient investors can harness its growth.

UK exposure

VT Tyndall Unconstrained UK Income

Manager Simon Murphy focuses on undervalued UK mid-cap companies, particularly those tied to the domestic economy. He observes, “UK mid-cap companies have good dividend yields in this part of the market. We aim to seek opportunities in companies that offer both capital growth and attractive dividends.” 

Given the UK’s economic outlook and the current undervaluation of certain sectors, this fund provides exposure to potential growth within the domestic market, complemented by income generation. We applaud the fund’s high active share and low active management charge.

Watch now: What catalyst is needed to propel UK equities in 2025?

abrdn UK Mid Cap Equity

Abby Glennie emphasises the potential within the UK small and mid-cap sector. She notes, “this area of the market delivers reasonable returns, the NUMIS index, for example, returned about 9.5% in 2024.” She also notes that despite recent underperformance compared with US large-caps, valuations are low relative to historical standards. “As the UK government seeks to stimulate growth, small and mid-sized companies are poised to benefit,” she adds. 

This is a high-conviction strategy targeting these companies, many of which are internationally oriented and consumer-driven, aiming to capitalise on potential market rebounds and policy support. Abby has delivered excellent performance across a number of strategies. This fund is no exception.

Added diversification 

Cohen & Steers Diversified Real Assets

Vince Childers advocates for the inclusion of real assets to enhance portfolio diversification. Reflecting on market performance, he says: “Think back to 2021/22 – stocks/bonds didn’t diversify each other… Diversified Real Assets was up roughly 16% at the peak, we have a proof of concept.” 

The fund invests in a mix of commodities, real estate, and infrastructure, asset classes that often respond differently to economic conditions compared with traditional stocks and bonds. This diversification can reduce overall portfolio volatility and provide a hedge against inflation, aiming to preserve and potentially enhance returns.

Jupiter Gold & Silver

Ned Naylor-Leyland advocates for the strategic inclusion of precious metals in any investment portfolio. He asserts, “all you have to do is look at a graph of US debt, to understand why you need gold in a portfolio today. It’s simply unsustainable.” As government debt levels increase, concerns about inflation, currency devaluation and fiscal sustainability grow. Since gold is a tangible asset, it’s long been considered a hedge against economic instability. Historically, periods of rising US debt have coincided with stronger gold prices, as seen during the 2008 financial crisis and the pandemic-driven fiscal stimulus of 2020-2021.

This fund uniquely invests in both physical gold and silver bullion, as well as shares of mining companies specialising in these metals. This dual approach offers investors direct exposure to precious metals and potential growth from mining equities.