Royal London Asset Management’s Trevor Greetham is building up equity positions in the multi-asset funds to take advantage of investors’ geopolitical concerns.
Greetham, who is already overweight equities, says the contrarian sentiment indicator has shown a buy signal for the first time since the French elections in April.
He says similar global concerns, such as the Chinese currency devaluations in 2015/2016, the European referendum and the election of Donald Trump all proved to be good entry points to the equity market.
Around 70 per cent of the Greetham’s £42.9m Royal London GMAP Adventurous fund is invested in equities.
Greatham, head of multi asset at RLAM, says: “After months of calm investors are starting to get rattled by geopolitical events with the stand-off with North Korea and large scale protests in the US causing some disquiet. It pays to buy when others are fearful and we are starting to add to the equity positions in our multi asset funds, increasing our overweight positions there.”
He adds: “Stocks have performed strongly over the last eighteen months and valuations are starting to get a bit stretched, but macro-economic fundamentals remain supportive with global growth continuing at a reasonable pace, inflation pressures easing and interest rates low.”