The funds to back
For brave investors, Mr Fahy has previously recommended Artemis European
Growth, up 42pc over the past year but he added: "If investors are looking for
‘cheap’ – then the obvious market to be dripping money into is China."
Ben Yearsley of Charles Stanley Direct, a low-cost fund supermarket, is also
lukewarm on European stock markets but said: "Looking for the positives, Europe
doesn't look expensive and the dividend yield from equities is good so it could
be bought and tucked away for the long term." He favors Henderson European Special Situations (with a typical historic
annual cost of 1.76pc), managed by Richard Pease, and Jupiter European fund
(1.79pc) and Jupiter European Opportunities investment trust (1.12pc), both
managed by Alex Darwall. Blackrock European Dynamic (1.68pc) is another
favorite. "All are run by good quality, long-term managers," added Mr Yearsley.
Cheap tracker funds
For cheaper options, consider a fund that only tracks the market. The
Vanguard FTSE Developed Europe fund charges 0.25pc a year and yields 2.6pc. A year ago, the dividend yields, which give a rough indicator of value, were
stunning on some European stocks with Swiss drugs maker Novartis paying nearly
5pc and German insurer Allianz at 4.6pc. Today they pay 3.6pc and 2.8pc,
respectively. Investors have certainly missed the buying opportunity of a year
ago. Those who want to back only high-yield stocks could consider the iShares DJ Euro STOXX Select Dividend 30, an
exchange traded fund that can be brought through a stockbroker. Its annual cost
is 0.4pc and it yields 6.2pc.
Cheap shares
David Dudding, who runs the Threadneedle European Select fund, which has
returned 91pc over five years compared with an average 35pc for the sector,
said: “Pricing power is everything in share investing.” Two examples he cites
are Nestle, the food giant, and Kone, a lift manufacturer. “The market sees Nestle as a boring dividend payer,” he said. “I see it as an
attractive growth stock. Meanwhile the lift market is very hard to break into.
It takes a long time to build up significant scale, so there’s little downward
pressure on prices and firms have great repeat business from maintenance
contracts.” Advisers say long-term investors should have some exposure to Europe to keep
a balanced portfolio, although this could also be achieved through a global
fund. Mr Fahy tips Artemis Global Income which has 23pc of investors money in
Europe. He added: “If you believe the eurozone can continue to muddle through
for the remainder of 2013, then hold your nose and stay on your toes, ready to
take profits.”
4 comments:
Jeff Sawyer@sawyerspeaks
The "father of fracking" has died at 94. It was a heart affrack. He was injected into the ground and toasted with flaming glasses of water.
WASHINGTON (Reuters) - Small business optimism fell in June from its one-year high as an uncertain recovery continues to unfold.
The National Federation of Independent Business said on Tuesday its Small Business Optimism Index decreased 0.9 point to 93.5 last month, changing course from two straight months of growth.
Six of the index's 10 components fell and two were unchanged. Only job creation plans and the six-month outlook advanced.
This mirrors economists' predictions that the economy will pick up momentum in the second half of this year after a lackluster start.
More owners are reporting negative sales trends than positive ones. "Nothing cheers up a small business owner more than a customer, and they remain scarce and cautious," the NFIB said.
Last month, the share of owners planning to increase inventories fell 4 points, accounting for about 40 percent of the decline in the index.
Job creation plans increased after slipping last month and the percentage of small business owners reporting they could not fill job openings remained the same.
After 51 successful years in business with less than 20 employees, I am finding it harder than ever to attract new customers. I attribute this to huge advertising budgets of large competetive companies which I cannot meet. Additionally, customers are giving less word-of-mouth recommendations for my business because of the aggressiveness of my huge competitors minimizing the value of personal service. I can still compete with cost, but prospects are finding it easier to just call the company advertising frequently on TV (which I cannot afford to do). Also, it continues to be extremely difficult finding and hiring quality, dedicated staff. Employees don't want responsibilities that conflict in any way with their personal family lives. My business revenues have been declining 1 to 3 percent a year for the past 3 years, regardless of everything I've tried to stimulate sales. I have always kept my business on the cutting edge of technology and give great incentives to my staff. I get solid praises from my customers frequently, but that is not enough to sustain my revenues now. My busainess is not a fad; it is insurance. The demand is constant, if not increasing.
The following is why small or large business will not thrive in the US. . As far as the US is concerned, until after WW11, the US had none, or very few laws governing the manufacture of goods in the US. There wasno minimum wage, environmental, worker safety, overtime or child labor laws. Starting after WW11, such laws started to be enacted to protect workers and the environment. The point is that, in effect, the US has burdened US manufacturers with costs that global trade never experienced, prior to WW11. In all economic theory, tariffs are bad. But as it stands now, the US has tariffs on domestic production that makes manufacturing in the US uncompetitive with China, Indonesia, Bangladesh etc. I am not suggesting that the US go back to pre-WW11 laws, what I am suggesting is that he US require products SOLD in the US be made with the same tariffs as MADE in the US. If this were the case, I would also suggest that we could open our markets to the whole world under such a circumstance. Just think how grateful a Chinese worker making 58 cent/hr. suddenly started making $7.25/hr. Just think how grateful citizens of Beijing would be if their air was as clean as Pittsburgh, PA and did not require masks when outside or covered domes for rich kids to play in.
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