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Global funds seek UK haven

Two-thirds of unit trusts in the global growth sector reduced exposure to the US in August, according to Lipper&#39s monthly review of UK funds.

Fund managers were looking to invest in the UK, with 60 per cent increasing their stake in UK equities.

The move away from the US followed the decline of the S&P 500 index for the second month running. The index fell by 8 per cent in August while the Nasdaq was down by 14.2 per cent. This compared with a fall of only 2.8 per cent in the FTSE 100.

The fund making the biggest shift away from the US was the JP Morgan-Fleming portfolio fund, which reduced its exposure from 39 per cent to 26 per cent.

Other big shifts were seen in the Jupiter ecology fund, down from 22.8 per cent to 18.2 per cent and the Cazenove updown retail fund, down from 61.3 per cent.to 58 per cent.

Top-performing funds in the Lipper survey during August had an average exposure to the UK market of 54 per cent while the five worst-performing funds averaged only 9 per cent UK exposure.

The best performer in the latest survey was the Cazenove Seymour ST fund, which fell by 0.02 per cent compared with an average decline for global growth funds of 3.9 per cent. The fund allocated 58.1 per cent of assets to UK equities.

The Lipper survey covers 152 unit trusts in the global growth sector out of a total Autif universe of 201.

Lipper global marketing director Steve Lipper says: “The relative outperformance of UK equities when compared both with European and US equity markets has insulated the sector from steeper declines. This has occurred because the global growth sector has traditionally held a high proportion of assets in UK equities.”

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