FT Adviser (11/04/2019) – More than half of advisers think investing in large-cap US equities is the best strategy to protect their clients’ portfolios from growing trade tensions, according to the latest FTAdviser Talking Point poll.
The poll asked advisers: “How should clients be positioned in US equities against the backdrop of the trade war with China?”
Some 62 per cent of advisers said their clients should invest in large-cap companies.
Almost one third (31 per cent) of advisers recommended their clients to invest in small and mid-sized cap stocks.
Only 7 per cent of advisers said their clients should have no exposure to US equities at all.
Not a single adviser recommended their clients to invest in US tech stocks.
A mid-cap is a company with a market capitalisation between $2-$10bn (£1.5-£7.6bn) and a large-cap is any company that has a market valuation of more than $10bn.
Ricky Chan, director and chartered financial planner at IFS Wealth and Pensions, said he was surprised by some of the respondents saying they wanted to have no exposure to the US.
But he shared the view that advisers would not recommend tech stocks, saying they prefer a more diversified approach to investing.
He added: “So this means that either they leave those decisions down to the active fund managers or, for advocates of passive funds, simply invest according to indices – both options may well include tech stocks but are not directly [down] to the financial planner’s decision.”
Full article link: https://www.ftadviser.com/investments/2019/04/11/advisers-recommend-us-large-cap-stocks-amid-trade-war-fears/
