It has a strong valuation discipline and a bottom-up company research focus. Manager David Gait is not afraid to step away from the benchmark, which may help to reduce some of the macro risk.
The other emerging market fund falling just outside our clients’ 10 most bought in the three months to the end of December was Jupiter India. India has one of the better developing market outlooks under Trump’s US protectionist politics, because its strong domestic economy can generate growth regardless of how its exports perform. What is more, prime minister Narendra Modi’s goods and services tax is due to be implemented in the first half of this year, which should be a big positive over the long term for the Indian economy.
A final wild card, if you like, which may spark some of your more adventurous clients’ interest this Isa season, is Russian equities. With sanctions and a plummeting oil price, the country’s economy has suffered. Putin has not been popular with developed nations’ leaders and investors have fled what was once considered one of the world’s most promising emerging markets.
But the Putin and Trump bromance, as I recently delightfully heard it termed, provides an opportunity to re-assess the Russian case. Given that US-Asian and US-Latin American relations are likely to be upset by some of Trump’s policies, we may see the risk premia at which Russian equities have traditionally traded versus their global peers start to gradually reduce. A small allocation to a fund such as Charlemagne Magna Emerging Markets Dividend, which currently has a 6 per cent holding in Russian stocks, could be one way to get some exposure.
Darius McDermott, managing director, Chelsea Financial Services
Key points
Clients are buying the same Isa funds they did this time last year, despite the Brexit vote in the interim
On US stocks, some fund managers are predicting higher corporate earnings following Trump's election
India might benefit from Trump's protectionist policies, because it is less affected by exports
