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Special opps

The financial sector has suffered most this year, with the index down by over 30 per cent to October 24 but there is one manager who has bucked the trend – Philip Gibbs (sadly no relation), who manages the Jupiter financial opportunities fund.

Very sensibly, he has avoided investing in the bigger banks but has invested a big part of the fund in bonds and, as a result, the fall in the fund value has only been 2.5 per cent this year. He has also invested in government bonds in the US and France so he has also taken advantage of currency gains.

He has avoided UK sterling funds but he will go back into the equity market when he believes it has bottomed out and will seek out lowly-rated companies with strong underlying growth, where the wider market has simply not recognised this. He will restructure the portfolio in anticipation of a significant change in market sentiment.

Over the years, Gibbs has had the consistent proven ability to call markets and pick the winners. He has made many astute decisions since launching this fund and over 10 years to October 1 he has made 360 per cent profits for investors.

He believes that economic conditions and profits are likely to worsen so he is avoiding businesses with high exposure to the US and the UK. Nevertheless, he is relatively positive about the prospects for his portfolio and has lost much less money than his competitors.

His bigger equity holdings include Alpha Bank, Zurich Financial Services, Aviva and Russia’s Sberbank. Around 42 per cent of the fund is invested in equities, 31 per cent in fixed-income investments and 27 per cent in cash.

This is a safety first fund which has huge potential when markets recover and Gibbs is a manager to back.

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