MAM Funds is taking a fairly cautious stance in its Midas balanced income fund, favouring bigger blue chip companies with strong balance sheets and dividend growth.
Chief investment director Alan Borrows is also finding opportunities among firms with exposure to fast growth and managers who are taking advantage of the continued deleveraging of banks, which means paying off debt that was taken on to generate growth. Borrows says banks are looking to get unwanted commercial property loans off their books and are unwilling to get involved in leveraged buyout deals, creating a window of opportunity.
In the commercial property sector, Midas balanced income is holding the Duet real estate fund, which finances the high quality property deals banks are looking to offload. He also highlights fund of hedge fund holdings in Acencia debt strategies and Signet global fixed income strategies as funds positions to take advantage of a pick-up in distressed debt.