The team had been negative on the US last year but a visit to the US in February this year prompted head of multi-manager Tony Lanning to take a different view. He felt as it had been the first into recession, the US would be the first out, particularly in the light of the Fed’s interest rate cuts which were intended to stimulate the economy.
Lanning says that in February, none of the active US managers he spoke to had much conviction, so he bought the iShares S&P 500 to get broad exposure to the US market. Although it turned out that Asia and emerging market have driven a recovery in the global economy rather than the US, Lanning says US economic data is getting better as a result of the Fed’s actions.
The Neptune US max alpha fund, managed by Felix Wintle, was added to the portfolio at the expense of the iShares fund. Wintle invests in a portfolio of 20 to 30 stocks that he believes will outperform. Lanning says the Gartmore team had been following Wintle for a while before investing with him. The team has also added Wintle’s Neptune US opportunities fund to the Gartmore multi-manager balanced fund.
Lanning says: “We spent time talking to Felix Wintle. He has a strong track record, we like his process and we thought we could take advantage of liquidity when it improved. That is basically what has happened.”