Funds and trusts four pros are buying and selling: Q1 2025

The Magnificent Seven US technology companies, which includes NVIDIA Corp (NASDAQ:NVDA) and Tesla Inc (NASDAQ:TSLA), continue to dominate the stock market globally.

While tech stocks have influenced US market returns over the past couple of years, other sectors could come into focus as Donald Trump takes office. As always, our fund-of-funds’ investors are taking a long-term view on the current economic environment.

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Every quarter, our multi-manager panel participants share their current bull and bear points. They alsodiscuss the new funds and investment trusts they have bought, those they have increased their holdings in, and the ones they have trimmed or sold.

Peter Hewitt, fund manager of CT Global Managed Portfolio Trust

Reason to be bullish: growth remains strong in the US and more modest elsewhere. Significant real wage growth and low unemployment should translate to strong consumer expenditure in the UK, which is a key driver of UK growth. The outlook looks brighter for the new year.

Reason to be bearish: there is uncertainty over the extent of tariffs likely to be introduced by the new US president. Inflation is currently proving sticky in most developed economies, which has reduced the magnitude of future interest rate reductions.

Bought: Hewitt has bought the JPMorgan Global Growth & Income Ord (LSE:JGGI) investmenttrust. He says it has “built an outstanding performance record over the last five years, well ahead of the benchmark, which is the MSCI All Countries World index; very few global funds have achieved this.” Utilising the extensive research resource within JPMorgan Asset Management, it is a global “best ideas” fund of around 50 stocks. The trust pays out 4% of year-end net asset value as a dividend on a quarterly basis and trades at a small premium to net asset value (NAV).

Increased: he has increased his holding in Scottish Mortgage Ord (LSE:SMT), which recovered strongly in 2024, with a near 20% share price gain. It “possesses much potential for future growth,” adds Hewitt. Around 20% is invested in large, well known established US technology companies, and 23% is in private companies with the best known being Space X. “The trust has exposure to some transformational companies that no other listed investment company has, yet it trades on a discount around -10% discount,” he points out.

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Sold:European Assets Ord (LSE:EAT).With parts of Europe (France and Germany) close to recession, the environment for smaller companies is challenging. “The trust has had a mixed performance record over the years and although it has a dividend yield of over 6%, which is paid from capital, the discount has moved steadily wider to over 12%,” says Hewitt. He has decided that there are better prospects elsewhere.

Vincent Ropers, co-manager of IFSL Wise Multi-Asset Growth fund and IFSL Wise Multi-Asset Income fund

Reason to be bearish: it is too early to say whether the re-election of Donald Trump will have a positive or negative impact on the global economy as both scenarios can easily be depicted. What can be said for sure, however, is that we are entering another period of strong economic and financial volatility where forward guidance will be limited given the wide influence and unpredictability of President Trump’s decisions.

Reason to be bullish: while growth and consumption in the US remain strong and have the potential to keep global growth positive, weaknesses are starting to appear in the rest of the world. With inflation proving stubborn, the spectre of stagflation is looming, likely to be made worse by weak and unstable governments around the world.

Bought: Ropersadded a new position in RIT Capital Partners Ord (LSE:RCP) investment trust, a portfolio of global public and private companies combined with some downside protection strategies.

“The trust suffered in the past from a lack of transparency and concerns about valuations of its private positions, but we believe changes in management over recent months should reassure investors and lead to a normalisation of the discount from current wide levels,” he says.

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Meanwhile, he has confidence in the quality of the underlying portfolio, offering upside potential at attractive valuations and with some protection against future volatility.

Increased: he continued to add to his healthcare positions, namely Worldwide Healthcare Ord (LSE:WWH) and RTW Biotech Opportunities Ord (LSE:RTW), after further weakness post-Trump re-election. Ropers argues that while Trump was positive for the sector in his first term, particularly for biotechnology companies which benefited from tax cuts, increased corporate activity (M&A) and a push towards innovation, investors worry this time around about Robert F. Kennedy Jr’s (pictured below) nomination as the head of health and human services.

“His lack of expertise, anti-vaccine and conspiracist views are unnerving for financial markets,” says Ropers.

While the appointment is yet to be confirmed by the US Senate, Ropers adds that if appointed, while possibly disrupting for large pharmaceutical companies reliant on insurance payments, it would not be in his power or interest to jeopardise the innovative biotechnology sector.

Ropers argues the market’s knee-jerk reaction to headlines should correct itself over time based on the strong fundamentals displayed in the sector.

Sold: over the quarter, Ropers sold out of his holding in abrdn Property Income Trust Ord (LSE:API).This wasfollowing the announcement of its wind-down-related asset sale.

Tihana Ibrahimpasic, portfolio manager, multi-asset team, Janus Henderson

Reason to be bullish:the US economy is bolstering the global cycle with a strong labour market and decreasing inflation, enhancing real consumer income growth amid an overall resilient economic landscape with easing interest rates.

Reason to be bearish:economic indicators signal increasing pressures, including a tangible risk of recession, owing to the effects of previous interest rate rises and emerging signs of strain within the labour market, which could potentially lead to substantial losses in equity markets if a recession were to materialise.

Bought: Ibrahimpasic opened a position in theUrban Logistics REIT Ord (LSE:SHED), which invests in UK-based industrial and logistics properties, typically single-let. Investments of the REIT are usually favouring industrial and logistics properties of high quality, offering investors potential for sustainable and attractive returns. “We believe that the valuation is attractive, and this exposure is of particular benefit to our income portfolios given an appealing level of yield,” she says.

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Increased: she used some short-term weakness to add further to her holding in US growth names. The goal, says Ibrahimpasic, is tokeep“the overall style profile of our portfolio well balanced”.

Sold: she closed a small position in the Regnan Global Equity Impact Solutions strategy, which she has been trimming throughout the year. The fund offers exposure to lower market cap businesses compared to the MSCI All Country World index, with sustainability characteristics. However, Ibrahimpasic notes: “Performance since Q2 2024 has been disappointing beyond the potential style headwinds.”

Simon Evan-Cook, manager of the Downing Fox Funds

Reason to be bullish: most economists seem depressed about “stubborn real wage growth”, but we shouldn’t forget this is economics-speak for “lots of people are getting a pay rise, and their pay is rising faster than the prices of stuff they might want to buy”. Viewed through a rosier lens, this is actually good news for consumption and therefore the economy.

Reason to be bearish: wages may be rising, but there’s still a lot of debt around, and this is likely to weigh down economic dynamism for the foreseeable future.

Bought: Evan-Cook recently added WS Amati Global Innovation. Its philosophy centres on identifying scientific and technological innovations that address challenges facing society, consumers, and businesses and then investing in companies that are creating and capturing value from these innovations. “This is a stock-picking, growth-orientated strategy, but the managers also have a keen eye on valuation,” says Evan-Cook.

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Increased: “We have made minor position-sizing changes with our US and UK portfolios based on our conviction in the underlying equity funds we own,” says Evan-Cook. In the UK, he increased his exposure to WS Gresham House UK Smaller Companies at the expense of Rathbone UK Opportunities Fund.

Trimmed: within the US, Evan-Cook and his team wanted to balance out their exposure. As a result, he reduced exposure to the world’s biggest economy.

The four multi-manager panellists

Peter Hewitt is fund manager of the CT Global Managed Portfolio Growth and CT Global Managed Portfolio Income Ord, where he specialises in investment trusts.

Vincent Ropers is a portfolio manager at Wise Funds, responsible for multi-asset strategies, using value and fundamental investment styles. He is co-manager of IFSL Wise Multi-Asset Growth and IFSL Wise Multi-Asset Income.

Tihana Ibrahimpasic is a portfolio manager on the multi-asset team at Janus Henderson Investors. Prior to taking this role in 2021, she was a research analyst in the team from 2018.

Simon Evan-Cook is a multi-asset, fund-of-funds manager with over 25 years’ experience in the investment industry. He joined Downing in 2022 to set up and manage the Downing Fox range of funds.