HOW TO ELECTION-PROOF YOUR PORTFOLIO With Ed Miliband promising more of an interventionist approach to government if Labour wins the next election, and David Cameron floundering at the reins, Padraig Floyd looks at how investors can protect their portfolios from burgeoning political risks.
week is a long time in politics, and the last few weeks, with the fate of Scotland in the balance, have been longer than most for UK investors. Yet, even after a “no” vote, the political landscape looks no more certain than it was at the last election. The implications for investors are no clearer, says
James Bateman, head of portfolio management at Fidelity Solutions. “Above all, markets hate uncertainty. A hung parliament after the general election would spook UK equity markets.” He adds that the potential for a prolonged political stalemate could see markets fall further and relatively quickly – by as much as
5 to 15 per cent. “Coalitions take time to form, so, any fall during the negotiation period could mean a buying opportunity for investors.” Matthew Beesley, portfolio manager and head of global equities at Henderson Global Investors, believes the effect the uncertainty has had on the markets makes trustnet.com
Why investment trusts are the ultimate weapon for income investors.