With Donald Trump’s second inauguration as US president taking place on 20 January, investors should remain focused on their investment strategy when assessing how to position themselves for any change of US administration.
Paul Angell, AJ Bell head of investment research, highlights four US funds for investors to look out for:
“While it is always difficult not to twist and turn with the wind following seismic political shifts such as Donald Trump’s comeback win in the US election in November, it’s important that investors remain focused on their investment strategy and what they know, as much as trying to second guess what the next four years could mean for global stock markets.
“Ahead of Trump’s inauguration next week, we’ve highlighted four US funds that stand out and may remain on the radar of investors as the US undergoes a change in presidential administration.”
Artemis US Select
“This fund benefits from an extremely experienced team head in Cormac Weldon, who’s been at the helm since it launched in 2014, as well as Chris Kent who joined to co-manage the fund in September 2022. The team have been involved in analysing US equities for over two decades, including during the previous Trump administration.
“The managers are style agnostic in their investment approach, assessing the fundamental strengths of businesses. Despite this style agnostic approach, their search for businesses with a two-to-one risk/reward potential (price target versus downside risk) often results in the fund displaying a higher growth profile than the index.
“The broader team consists of six analysts split by sector who travel to the US a number of times a year and have around 25 stocks under coverage at a time. The fund has enjoyed a return to form in recent years, with stock selection within the Magnificent Seven being particularly beneficial.”
Artemis US Smaller Companies
“Another from Artemis and Weldon alongside a different colleague in Olivia Micklem, this Smaller Companies fund benefits from similar qualities as its US Select alternative across experience, team and process. Again, the managers assess the fundamental strengths of businesses, typically resulting in more of a quality bias in this fund versus the market, as well as a lower exposure to cyclical companies and loss makers.”
iShares Core S&P 500 ETF
“iShares is the largest provider of ETFs in the world and is part of BlackRock, the world’s largest investment manager. This ETF, tracking the S&P 500 index, is a very cost-effective method of gaining exposure to the largest companies in the US. The investment objective of the fund is to deliver the net total return performance of the benchmark index (being the S&P 500), less the fees and expenses of the fund.”
JP Morgan US Equity Income
“The support provided by the well-resourced JPM analytical team to co-PMs Andrew Brandon and David Silberman is a strong feature here, with the managers looking to provide dividend growth as well as total returns that are broadly in line, but less volatile, than those of the S&P 500.
“The managers therefore focus on quality businesses that have a dividend yield of at least 2% and that are trading at attractive valuations. This income requirement in US equities has been a headwind for the fund in recent years as the market has, for the most part, been led by zero or low yielding technology stocks which the fund cannot purchase.”
