The managers of Resolution Asset Management's (RAM) £128m American Growth fund have dismissed US economic doomsayers, predicting the market will bounce back in the new year.
As many booming companies across the Atlantic struggle to maintain margins, joint managers Alison Porter and Terry Ewing are taking an overweight position in healthcare, telecoms and utilities.
RAM is buoyant on the healthcare sector – saying manufacturers of testing, measurement and diagnostic equipment are benefiting from the ageing US population.
Major stocks in the portfolio include medical diagnostic manufacturer Inverness Medical and Hologic, a digital mammography specialist.
In agriculture, global demand for wheat and corn continues to boost US farmer profitability, with Ewing and Porter overweight in stocks such as Monsanto and Agco.
Aerospace and utilities, especially alternative energy strategies, are other favourable areas as well as global brands including McDonalds and Nike.
Ewing says the secret at the moment is to “be nimble and pragmatic”.
“We have managed to avoid the worst financials but we would like to see banks post further write-offs so the market can digest the news,” he says.
“The US is a very broad market and there are always franchises growing and executing well.
“Finding 60 or 70 stocks that we have real confidence in is not a problem.”
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First mentioned in Cridland Report