Investment funds giving peace of mind

Saturday 10 October is World Mental Health Day and I think we can all agree mental health is especially important today given the current environment. From national lockdown to working from home, the pandemic has had a huge impact on many aspects of our lives, including our mental wellbeing. Changes in routine, less contact with friends and family, uncertainty over employment, financial anxiety have all taken their toll.

And we’re still surrounded by uncertainty: will a vaccine be found? If yes, when? Will there be a second lockdown? Will we get a Brexit deal? Elections, trade wars, climate change… the list could go on. Unfortunately, most of us are not in a position to do anything about these challenges. What we can do, is take control of our finances and aim for some peace of mind – even if it is just knowing our payments are set up as direct debits.

“Uncertainty is the only certainty there is, and knowing how to live with insecurity is the only security.” — John Allen Paulos, writer and professor of mathematics

While there’s no magic formula to know what stock prices will do next and there can be any number of factors influencing their fortunes – good and bad – one thing we do know is that markets hate drama. We’ve seen this with the recent pandemic, Trump and, of course, the long and complicated implications of Brexit. But if you’re investing for the long term, remember: the stock market has always picked itself back up after every major fall in history.

Concerned about the state of the world? Don’t put all your eggs in one basket. Diversify across regions and asset classes, or leave the choice up to a multi-manager fund. Here are five funds to get you started.

Close Managed Income

This is a multi-manager fund which sits on the more conservative side of the risk spectrum, with preservation of capital a strong focus alongside income generation. It invests in equities, fixed interest and alternative assets like car parks and infrastructure, allowing you to diversify across numerous asset classes without doing the research and balancing yourself.

Co-manager Matthew Stanesby told us more in this podcast interview:

Liontrust Special Situations

Run by two experienced managers, this fund has a bias towards smaller and medium-sized firms. The managers look for companies with hidden intangible strengths such as intellectual property, a strong distribution network or recurring revenues – all attributes that help them grown no matter what the prevailing economic environment.

Premier Multi-Asset Growth & Income

With exposure across equities, bonds, property and alternatives, this fund aims to provide equity-like returns, with less volatility, through a multi-asset, multi-manager portfolio. The fund currently has exposure to Elite Rated Evenlode Income, Polar Capital Global Insurance and Baillie Gifford Strategic Bond.*

Threadneedle European Select

A core European holding, this fund targets high-quality companies on the Continent, which have the power to raise prices in any economic environment. A highly concentrated fund, with the top 10 making up 43.8%* of the overall portfolio, it has a strong track record of outperforming in falling markets.

LF Tellworth UK Smaller Companies

A pure smaller companies fund launched in 2018, LF Tellworth UK Smaller Companies is run by two very experienced and highly regarded managers. They focus on smaller companies, avoiding micro-caps and mid-cap stocks as well as high risk areas like oil & gas, biotech and mining businesses.

*Source: fund factsheet, 31 August 2020

The views of the author and any people interviewed are their own and do not constitute financial advice. However the knowledge that professional analysts have analysed a fund or trust in depth before assigning them a rating can be a valuable additional filter for anyone looking to make their own decisions. Before you make any investment decision make sure you’re comfortable and fully understand the risks. If you invest in fund or trust make sure you know what specific risks they’re exposed to. Past performance is not a reliable guide to future returns. Remember all investments can fall in value as well as rise, so you could make a loss.