North American growth funds have been added for the first time to the FE Invest Approved list, as funds in the region are viewed more favourably for UK investors in light of concerns over UK equities as an asset class - following the Brexit vote.
- North American growth funds debut in FE Invest Approved List
- Concerns grow over UK equities as an asset class
- Questions raised over the market need for multi-assets funds in new investment environment
FE Research rebalances its list of preferred funds twice a year and the latest changes reflect the view that UK investors are likely to face further volatility for the foreseeable future as speculation over and details of a Brexit plan are widely debated.
Rob Gleeson, head of FE Research, says: “We have had to greatly expand our US coverage. North America presents an attractive opportunity for British investors in this post-Brexit environment – especially if sterling remains weak against the US dollar.
“We also don’t see Trump as a threat – even if he wins the US elections this November, we imagine a lot of the actual policy decision-making will remain with the GOP old-hands. At the moment – we see President Trump as less of a threat than we do Brexit for UK investors.”
Fidelity American Special Situations, Legg Mason ClearBridge US Large Cap Growth and T. Rowe Price US Large Cap Equity have all made it on to the FE buy list.
Gleeson adds: “While we are not concerned over the quality of UK equity funds currently in the FE Invest Approved list – we are certainly concerned over the asset class as a whole in light of the recent vote to Brexit.”
Notable exits from the FE Invest Approved List also include big names such as Standard Life Global Absolute Returns, M&G Optimal Income and Jupiter Strategic Bond.
There has also been a reduction in the number of mixed asset funds from the FEI Approved List.