This site uses cookies. By continuing to browse the site you are agreeing to our use of cookies. Find out more here.
X
MM+Cover+small+181214
Categories:Investments

Neptune: Don't be scared of cash during volatility

  • Print
  • Comment

Neptune head of client investment strategies Douglas McDowell says managers should not be afraid of using cash during market volatility.

Speaking at the Cofunds investment forum in Hertfordshire last week, McDowell said money managers in the balanced managed sector do not use cash as a strategy during market volatility.

He said: “The out-of-market risk in most managers’ minds is too great. They are concerned that if they have a lot of cash the market might go up.

“They think they are not doing their jobs as stockpickers if they hold a lot of cash. In turbulent times, if you get it right and have lots of cash, you will hang on to your capital. The success of long-term investing is based on two things, it is riding on the waves when it goes up and hanging on when the market goes down. You can only do that if you have cash.”

The £811.6m Neptune balanced fund, managed by founder Robin Geffen and Ted Alexander, had 22.9 per cent in cash at the end of October up from 17.4 per cent at the end of July.

Skerritt Consultants head of investments Andy Merricks says: “Holding cash is an acceptable strategy as long as it is a short-term play. Our discretionary portfolios are running 30 to 34 per cent cash. People who invest money in these portfolios and balanced portfolios trust their capital will be preserved.”

  • Print
  • Comment

Daily Email Updates
If you enjoyed this article, sign up to receive the latest news and analysis from Money Marketing.

The Money Marketing CPD Centre
Build your annual CPD - you can log and plan your CPD hours for free with The Money Marketing CPD Centre.

Money Marketing Awards 2015
Put your firm forward as the leading practitioner in your field. Adviser and Advertising categories are open to entries - Enter Now.

Have your sayEdit my profile/screen name

You must sign in to make a comment

AXA Wealth


Fund Data

Editor's Pick



Poll

Two years on from the RDR, do you think consumers are better off as a result?

Job of the week

Latest jobs

View all jobs

Most recent comments

View more comments