The trials of managing a global equity fund are such that sometimes you have to shut out the noise and trust your instincts. Now seems such a time.
I am hearing the Chinese authorities may have raised interest rates too far, creating the possibility of a hard landing for the economy and concern in global financial markets about a drop-off in demand for commodities and fall in consumer activity that could set back the much needed rebalancing of the global economy.
But I believe the Chinese have embarked on a long-term programme of urbanisation and is not going to be derailed by short-term concerns over borrowing costs. This is creating immense challenges and opportunities in the infra-structure sectors of water and power. Wealth creation continues unabated in China and other developing economies.
Shutting out the noise, holdings in CF Miton global growth such as Pictet Premium Brands, Atlantis China Healthcare, Pictet Water and Gemini Most India offer potential for fabulous growth and investment returns over the longer term rather than risks to capital in the short term.
I am also hearing the US is spending too much but has economic growth, although that might falter as spending reduces, while the UK is not spending enough to sustain economic growth. Again, I believe there are some amazing companies in both nations, and that are using their strength to expand into the fast-growing developing nations. Many of these companies are paying high and rising dividends as well.
I look at holdings such as Psigma American growth and Cullen North American high dividend and see not short-term risk but attractive valuations and opportunities to make strong returns over the medium to long term. In the UK, there are stock-specific managers such as MFM Slater growth and CF Walker Crips UK growth that have proved adept at sidestepping more economically sensitive companies to deliver excellent returns and I have every confidence that they will continue to do so.
Elsewhere, I am hearing that Japan is the best value equity market and that foreign investors are pouring money into Japanese equity funds but I believe Japan is a broken country with unappealing demographics The lack of a compelling longer-term growth story means we have a zero weight to Japan.
Throw into the noise the Arab Spring and the seeming likelihood of European debt default and I am even keener to shut it out and trust my instincts in the search for longer-term growth opportunities, of which plenty abound.
Sam Liddle is fund manager of the CF Miton Global Portfolio at MAM Funds