ISA 2019: Around the world in six equity funds

There are 195 countries in the world. While it only took Phileas Fogg 80 days to make the global trip, in reality it would probably take significantly longer and would depend on how long you'd like to spend in each nation. One day per country would equate to just over six months; one week in each would take 3.7 years; a month would take 16 years – and is possibly a very nice retirement plan.

But as there are less than two weeks left of the 2019 ISA season, we'll take a whistle-stop tour of the globe instead - looking at six equity funds from around the world you may want to consider for your £20,000 allowance.

For a more comprehensive list of funds ideas, take a look at the Chelsea Selection.

United Kingdom

The headlines have been dominated by Brexit and what deal, if any, the UK will get from the EU. The uncertainty has resulted in valuations of UK equities looking incredibly cheap from a global perspective.

Schroder Recovery

Schroder Recovery fund looks to invest in businesses which have suffered a setback but still have good, long-term prospects. This quietly aggressive, value-driven fund has been run by Kevin Murphy and Nick Kirrage since 2006. The fund is very much for the long-term investor, as the catalysts for change in a company can take time and some stocks may even get cheaper.

Europe

Europe has been much maligned as a result of Brexit and political fears in both Italy and France amongst others. There has been talk of recession in the region amid slowing growth, but some fundamentals, such as the strong rate of employment, indicate opportunities.

Jupiter European

Managed by one of the most experienced European managers, Alexander Darwall, this fund is a high conviction portfolio with a bias towards medium and larger companies. Alexander generates his own ideas, primarily through company meetings, and target firms with superior products that can deliver regardless of the economic environment.

United States

The US economy was boosted last year by a big tax cut and an increase in government spending. However, it does have some challenges courtesy of an irascible President and an ongoing trade war with China.

Brown Advisory US Flexible Equity

Finding funds with long-term out performance of the S&P 500 is very difficult, and this strategy has been doing just that for more than a quarter of a century. Managed by Maneesh Bajaj and R. Hutchings Vernon (Hutch), the fund was launched in the UK in 2014. Maneesh and Hutch primarily target undervalued medium to large improving businesses and stick with them for the long-term. Their approach tends to result in the fund falling less when stock markets go down.

Japan

In December 2012, Shinzō Abe was formally elected prime minister of Japan and “Abenomics” – his extraordinary stimulus programme – was launched. After decades of stagnant growth and false dawns, life was finally breathed back into the economy, however external risks and trade friction could still impact investor sentiment.

Baillie Gifford Japanese

With a 30-year plus track record, this fund is one of the most established in the sector. The fund, which has a bias to medium-sized companies, invests in well-managed businesses with a strong competitive advantage that are not overpriced. The research process is designed to ensure that the best ideas of each individual team member are included in the portfolio.

India

The International Monetary Fund believes India will be the fastest growing economy in the next couple of years, with growth estimates of 7.5% and 7.7% for 2019 and 2020 respectively*. The country now accounts for around 15% of global growth and is set to pass Germany and Japan to become the third-largest economy by 2030.**

GS India Equity Portfolio

This multi-cap fund’s objective is to capture the growth potential of the Indian economy and has a slight bias to small and medium-sized firms. Manager Hiren Dasani and the team have a very long-term time horizon and a very low portfolio turnover. He is a patient investor, and, because of this, the portfolio can weather day-to-day volatility to tap into significant growth opportunities.

Latin America

The start of 2019 has been kinder to Latin America than most of 2018 when a rising US dollar and commodity price weaknesses hit numerous economies. The IMF says growth is projected to recover over the next two years*, albeit from a low level in 2018, and the valuation of stocks in the region are now looking good value.

Aberdeen Latin American Equity

Headed by Devan Kaloo, the team behind this fund will typically meet a company up to five times before an investment is made. The average holding period is more than five years and the team are happy to add to positions during periods of market volatility. The fund is not for the faint-hearted, but the focus on quality stocks means can be less volatile than some of its peers.

Past performance is not a reliable guide to future returns. You may not get back the amount originally invested, and tax rules can change over time. Darius's views are his own and do not constitute financial advice.

*Source: IMF World Economic Outlook Update, January 2019
**Source; HSBC, Bloomberg, September 2018