A beginner’s guide to investing in small-caps in 2024
Investing in the stock market can be a rewarding yet challenging endeavour. For those looking to ...
This Sunday is Mother’s Day. The one day each year when we all remember to say “thank you” for everything our mothers do for us, and the day we try to do something for them.
While we can’t go out for a nice lunch just yet, or treat our mums to a nice spa, I’m sure we’re all experts at ‘staying at home’ fun by now.
But if you are still looking for ideas, we’ve had a look at some holdings in our Elite Rated funds that could fit the bill.
Let’s start with an old favourite, chocolate. Hotel Chocolat is one option. The company has done a good job of defying the UK high street woes and has expanded where others have contracted. But what really sets the company apart is that its chocolate has a sustainable supply chain.
Lindt also comes to mind at this time of year, when gold bunnies are being advertised for Easter… And then there’s the traditional: Cadbury’s and Nestle. Nestle is a top ten holding** in Janus Henderson European Focus and the largest holding* in Threadneedle European Select – and is home to offerings such as Quality Street and Dairy Box.
Depending on your budget, you could go all out at get a designer gift from the likes of Coach. The designer, producer and marketer of luxury goods such as handbags, gloves, scares and jewellery, is a holding** in Ninety One Global Special Situations. The UK version of this fund, Ninety One UK Special Situations, has perhaps a more wallet-friendly option in holding Next*.
And then there’s the online giants of Boohoo and ASOS. Both are holdings in Marlborough Multi Cap Growth fund. Manager Richard Hallett said that, in January, he took a position in ASOS after it bought parts of Sir Philip Green’s retail empire, including Topshop, Topman and Miss Selfridge, for a knockdown £265m. “This looks like a clever move against a background of strengthening e-retail and diminishing high street retail demand,” he said. “To reduce concentration in this sector, we top sliced out holding in BooHoo. That is not to say that the potential of the Debenham’s deal is not substantial, but we want to avoid the fund being overly concentrated in this sector.”
Lunch at a nice restaurant is still out of the question at the moment, but that doesn’t mean that a good meal can’t be enjoyed! Deliveroo, Uber Eats and Just Eat are all offering to deliver the takeaway of your choice.
Domino’s Pizza is the UK’s largest pizza delivery business with over 1,100 outlets. It’s a holding in Liontrust Special Situations. The managers commented, “The UK pizza delivery market has grown rapidly and through its network expansion, Domino’s has been able to capture a large proportion of this growth. We believe that the company’s online and physical distribution network will continue to represent a substantial barrier to competition. Digital sales are a big driver of growth, now accounting for over 90% of UK delivery sales.”
While many of us have spent lockdown with little make-up wearing lounge gear, self-care has continued and, as we begin the gentle reopening, I’m sure more time will be spent in front of the mirror. Make-up and skincare provider L’Oreal is a holding** in Legg Mason IF Martin Currie European Unconstrained.
Another option is Elementis, one of the UK’s largest speciality chemicals and personal care businesses, and a holding in VT Downing Unique Opportunities. Manager Rosemary Banyard told us about one of its unique characteristics: “It has a unique asset in the form of a mine in California,” she said. “This mine has Hectorite, which is a rare, soft, greasy, white clay mineral that is used in products to help them flow better – like lipsticks and nail varnish. This resource has a 50 year life.”
Find out more in this video interview:
And for everything else there’s always Amazon – especially if you’ve left things to the last minute! The global giant has been one of the biggest beneficiaries of global lockdowns and remains a firm favourite with a number of Elite Rated managers. It is a top ten holding in Invesco Global Focus*, T. Rowe Price US Large Cap Growth Equity* and Rathbone Global Opportunities, for example. The latter also owns PayPal, to help you pay for the gifts!
*Source: fund factsheet, 31 January 2021
**Source: FE fundinfo, full portfolio holdings as at 31 January 2021