Page 44 - DIY Investor Magazine | Issue 39
P. 44

  Nov 2023 44
DIY Investor Magazine ·
One strategy in this sector makes the grade for Saltydog Investor.
At Saltydog Investor we normally focus on the short term; one week up to about six months.
Each week we generate graphs and tables showing members the performance of a wide range of funds over the last weeks and months. We present the data in a way to help DIY investors identify which sectors are trending up, and highlight the best performing funds in each sector. It works well for people
who look forward to reviewing their investments weekly, but understand that others prefer to take a longer-term view.
So, we trawl through our fund data every three months looking for funds that have consistently achieved gains of 5% or more in six consecutive six-month periods, published as our ‘6 x 6 Report’.
At the beginning of November, no funds met the target in each of the six-month periods, although three funds have risen by more than 5% five times out of six.
They are the three energy funds, Schroder ISF Global Energy, WS Guinness Global Energy (which used to be TB Guinness Global Energy), and BGF (Blackrock) World Energy.
These funds were badly hit by the pandemic when the world locked down and demand for energy plummeted. However, they recovered and performed well in 2021 when most other funds struggled.
Demand for commodities like oil and gas accelerated as countries went back to work, while supply was disrupted by the war in Ukraine.
They continued to perform well through H1 2022, but then saw a sharp correction. Inflation soared, interest rates rose, and it looked as though America and other developed economies were heading into a recession.
The anticipated demand for energy and natural resources might have been overstated. However, so far, recession has been avoided and inflation has started to fall; the energy funds soon recovered and went on to set new highs in Nov 2022.
The following six months were disappointing, and all three funds dropped; recovery in China was much slower than expected, and overall global growth was sluggish.
Since then, there has been a bit of a recovery; in the six months
from the beginning of May these funds gained 9% or more. China’s economy is getting going again, with annual GDP growing by 3.9% in Q3 compared with 0.4% in Q2, beating
The US also had a good quarter, with its economy growing at its fastest rate since the end of 2021. This will push up demand for oil, while supply is limited by OPEC and Russia.
The outbreak of war in Gaza temporarily pushed the oil price, but it subsequently eased back; however, with political tension in the Middle East, it always possible that oil supply will be affected.
Over the years we have held all of these funds in our demonstration portfolios, but at the moment we are only invested in the Schroder ISF Global Energy fund.
For more information about Saltydog Investor, or to take the 2-month free trial, go to

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