EMs poised to ‘fire on all cylinders’ – S&W’s James Burns

31 August 2021

James Burns, co-manager of the Smith & Williamson Managed Portfolio Service, comments:

“It is no secret that Emerging Markets have yet to fire on all cylinders.

“Emerging Markets are suffering their worst performance relative to US stocks in two decades. But we think this trend is set to reverse, and investors looking for growth should not shy away from investing in Emerging Markets.

“We would expect to see Emerging Markets grow at a faster pace than some developed markets over the next few years. There’s no reason to assume that other regions in the world won’t grow, but we think that Emerging Markets are looking more attractive than they have done for some time.

“To take advantage of this opportunity, we hold a number of actively managed funds in our Managed Portfolios. We feel that passives haven’t covered themselves in glory in the Emerging Markets regions, and many, with their substantial costs involved, have been unable to track the market with the same efficiency as they have with the US and European markets. 

“We hold the BlackRock Emerging Markets Equity Strategies fund in our higher risk portfolios as it should, in the long term, act as a good diversifier, given its contrarian value slant. Despite a poor year in 2020, it has performed well year to date.  

“We also like the Goldman Sachs India Equity Portfolio, which we again hold in our more growth-focused portfolios. Whilst we have trimmed the fund previously, we are positive on the long-term outlook for India, as despite not having the same global industry leading companies, is somewhat of a safer market than China given the latter’s government risk.”

About Tilney Smith & Williamson

Tilney Smith & Williamson is the UK’s leading integrated wealth management and professional services group, created by the merger of Tilney and Smith & Williamson on 1 September 2020. With £54.8 billion of assets under management (as at 30 June 2021), it ranks as the third largest UK wealth manager measured by revenues and the eighth largest professional services firm ranked by fee income. The Group currently operates through three principal brands: Tilney, Smith & Williamson and online investment service Bestinvest. It has a network of 28 offices across the UK, as well as the Republic of Ireland and the Channel Islands. Through its operating companies, the Group offers an extensive range of financial and professional services to individuals, family trusts, professional intermediaries, charities and businesses. It is uniquely well-placed to support clients with both their personal financial affairs and their business interests. Tilney Smith & Williamson’s personal wealth management services include financial planning, investment management and advice, online execution-only investing and personal tax advice. For businesses, its wide range of services includes assurance and accounting, business tax advice, employee benefits, forensic advice, fund administration, recovery and restructuring and transaction services.