Young people these days… five investment ideas for Generation Z

As the clock struck midnight on 31 December 2017, every single adult in the world had been born in the 19th or 20th century, and every single child had been born in the 21st century.

I can still remember partying like it was 1999, so it makes me feel ever-so-slightly old when I think that those babies born in 2000 are coming of age this year. As they leave school and either go to university or take up their first job, the thoughts of ‘Generation Z’ are more likely to be on spending money than saving it, but the earlier they can start putting some money aside for their financial future, the better.

Another factoid I came across recently is that it would take 72 years to double your money if you hold it an a cash account paying 1%. Even those millennial babies haven’t got that long until they retire.

But those lucky enough to have had money invested for them – perhaps in a junior ISA – or those who can save just a small amount each month, can afford to take a lot more risk over a 50 year time horizon. So we take a look at some higher-risk funds, which could be very rewarding over the years.

Aberdeen Latin American Equity

This fund invests in some very volatile, but exciting, Latin American emerging markets. Its unconstrained approach means it can build up large country positions, but the emphasis on quality companies helps it minimise volatility.

CF Livingbridge UK Micro Cap

This fund invests in the UK’s very smallest companies. Livingbridge has experience of working with businesses and management teams before they even come to the stock market and this can give them an advantage over their peers, allowing them to invest at very early stages of a company’s life.

Goldman Sachs India Equity Portfolio

Like the population, investment opportunities in India are still young and growing. This fund aims to capture the growth potential of the Indian economy by investing in businesses of all shapes and sizes. The team running it are very experienced and based on the ground in India and Singapore.

Schroder Oriental Income Trust

Matthew Dobbs has run this trust since well before millennial babies were even a glint in their fathers’ eyes! It invests in Asia Pacific companies (excluding Japan, but including Australia and New Zealand) that offer attractive yields and growing dividend payments.

T. Rowe Price European Smaller Companies Equity

This is an excellent pan-European smaller companies fund run by a very experienced manager, with the backing of a dedicated team and all the resources that T. Rowe Price can provide. The manager describes his ‘mission’ as being early identification of long-term opportunities.

This article is provided for information only. The views of the author and any people quoted are their own and do not constitute financial advice. The content is not intended to be a personal recommendation to buy or sell any fund or trust, or to adopt a particular investment strategy. 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. Past performance is not a reliable guide to future returns. Market and exchange-rate movements may cause the value of investments to go down as well as up. Yields will fluctuate and so income from investments is variable and not guaranteed. You may not get back the amount originally invested. Tax treatment depends of your individual circumstances and may be subject to change in the future. If you are unsure about the suitability of any investment you should seek professional advice. Whilst FundCalibre provides product information, guidance and fund research we cannot know which of these products or funds, if any, are suitable for your particular circumstances and must leave that judgement to you. Before you make any investment decision, make sure you’re comfortable and fully understand the risks. Further information can be found on Elite Rated funds by simply clicking on the name highlighted in the article.