Winter Investment Outlook

TD Recommended Funds

Our fund recommendations are drawn from the whole of the market and selected using a two pronged approach with Morningstar’s analyst team providing unbiased in depth research that is analysed by our own Investment Team. We also carry out our own research and all recommendations are presented to and approved by TDDI’s Investment Committee.

As a result of our collaborative research we sometimes introduce new funds to the list. New funds are intended to offer more variety in popular asset classes, as well as access to additional asset classes such as Indian equities which deliver further diversification benefits.

Additions

Jupiter India

India has been called the "biggest turnaround story" in emerging markets. The Indian government has a strong focus on long-term, gradual GDP growth. A number of successful reforms have contributed to this growth, including increased infrastructure spending, reforms in the power sector and streamlining the country’s much maligned bureaucracy. Fund manager Avinash Vazirani has been investing in the Indian equity market for over 20 years and has run this fund since inception in February 2008. His growth at a reasonable price approach leads him to favour small- and mid-cap names with strong growth prospects that have not been fully priced by the market. His focus is on high quality companies based on his belief that fundamentals will prevail, particularly in difficult market environments. The fund has an excellent long-term performance record and we feel it is a welcome addition to our Recommended Funds list.

Removals

There were no removals this quarter

Morningstar Rating Downgrades

IP Global Smaller Companies - Bronze to Neutral

The fund’s regional allocation has been structurally at odds with its performance benchmark for some time, which has had a significant impact on returns. Morningstar believes this stance has had too great an influence on performance, and does not play fully to the fund's strengths. Each underlying manager is well equipped in running the underlying sleeves in their own right; but Morningstar’s view is that there could be more structure in bringing each of them together in aggregate, and with regards to regional allocation given the fund's performance objective.

Henderson Global Technology - Silver to neutral

Stuart O’Gorman has managed this strategy since 2001 using a benchmark-aware approach, leading to a portfolio with a larger-cap bias compared with the category average and with a relatively low active share. The increasing prevalence of passive funds in the technology sector has made it a more competitive area of the market, particularly for an index-aware strategy such as this. The strategy has underperformed the index over three and five years, and its volatility has also increased. Morningstar says it now finds the fund a less compelling proposition relative to other options available to investors seeking dedicated technology exposure and has moved the rating from Silver to Neutral.

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Important Information

The information we provide in this Investment Outlook are opinions provided by TD Direct Investing or one of its partners on whether to buy a specific investment. None of the opinions we provide are a personal recommendation, 

Investors should be aware that the value of investments can fall as well as rise, you may get back less than you invested. Past performance is not a reliable indicator of future returns.

If you are unsure about the suitability of a particular investment you should speak to a suitably qualified financial adviser.