Page 30 - DIY Investor Magazine - Issue 26

THE TWO UK FUNDS SALTYDOG HAS JUST BOUGHT
From 1 January 2020 to the end of October, the FTSE 100 fell by 26%. It is not the only stock-market index that has struggled this year, but it has done worse than most.
The big fall came during the first quarter of the year as it became clear that the Covid-19 outbreak that began in China was spreading around the world.
In the first three months of the year, the FTSE 100 lost 25% of its value. In the US, the S&P 500 fell by 20% over the same period, and the Nasdaq was down 14%. In Japan, the Nikkei 225 dropped 20% and in Germany the DAX shrank by 25%. It was a similar story for other stock markets.
Over the next seven months, most stock markets rebounded. The S&P 500 went up by 27%, the Nasdaq gained an amazing 42%, the Nikkei 225 grew by 21% and the DAX made 16%. However, after making a brief recovery, the FTSE 100 dropped back again and between the beginning of April and the end of October lost a further 2%
In November, there was another upturn in markets and this time the UK has not been left out. In the last three weeks, the FTSE 100 has gone up by 13.9%.
Each week, we analyse the performance of a wide range of funds. We sort them, based on their Investment Association sector, and put them into our Saltydog Groups, based on their historic volatility.
The Saltydog Groups are: Safe Haven, Slow Ahead, Steady as She Goes, and Full Steam Ahead (which we split into developed and emerging markets).
When we reviewed the numbers last week, the best performer over the previous four weeks was Steady as She Goes. The leading sectors, from any group, were UK Equity Income and UK All Companies.
‘IN NOVEMBER, THERE WAS ANOTHER UPTURN IN MARKETS AND THIS TIME THE UK HAS NOT BEEN LEFT OUT. IN THE LAST THREE WEEKS, THE FTSE 100 HAS GONE UP BY 13.9%’
Data source: Morningstar
We have only had a relatively small amount of exposure to the funds from the UK Equity sectors in our demonstration portfolios.
We invested in the Kames UK Opportunities fund, from the UK All Companies sector, towards the end of April and held on to it after it changed its name to Aegon UK Opportunities. In just under seven months, it had gone up by nearly 20%, a great result, but it looks like other funds in the same sector are now leading the way. Last week, we sold it.
We have replaced it with a fund that features in our latest analysis: the Artemis UK Select fund.
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