Neptune sets out criteria for investing in banks

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Neptune's head of UK equities Jeremy Smith has outlined why his team remains underweight in financials, and has set out five key criteria which would need to improve before he would reinvest in the sector.

As a house, Neptune has been underweight in financials for just over a year, and as such its funds have been less adversely impacted by the credit crunch than many of its peers - Smith's own UK Equity fund is top quartile over one year, though still lost 11pc (bid-to-bid, according to Lipper, 06.08.08). Drawing on a traffic light analogy, Smith outlined how the state of structured credit markets, the US housing market, the availability of credit, inflation and the strength of the US dollar were all 'red' six months ago; meaning it would be disastrous to invest. However, whilst the avail...

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