UK retail investors are keeping the faith with US investments. Latest figures from the Investment Association (IA), the investment management trade body, show that North America was the second best-selling fund sector in May 2022, with net sales worth £444 million.
May was not an isolated month. According to the IA, around £1.3 billion has poured into US funds since February. In contrast, UK funds recorded net outflows of around £3 billion over the same period.
Investors are persisting with the US sector despite the US S&P 500 stock index moving into official ‘bear market’ territory having shed more than 20% in its value since the start of this year. And neither are they deterred by an increasingly gloomy outlook for the high-growth tech stocks that are a mainstay of US indices.
According to financial commentators, the US stock market looks more attractive than it has for several years.
The argument goes that high company valuations built up during a period of US corporate dominance in recent years made it difficult for investors to justify adding extra exposure to the region. But now, thanks to recent share price falls, a number of areas look better value, including ‘mega-cap’ tech stocks and select smaller companies.
With this in mind, we asked Juliet Schooling Latter, research director at FundCalibre, to identify five US funds suitable for would-be investors.
Juliet’s fund selections appear below (in alphabetical order) along with key details about each portfolio plus the reasoning behind each choice.
Note that stock market investing involves risk and is not suitable for everyone. Before you consider investing, it’s important to work out your financial goals.
Ideally, build up a ‘rainy day’ cash fund equal to at least three months of your usual outgoings before taking the investment plunge. The value of investments can fall as well as rise, and your capital is at risk.
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Read More: Best US Funds 2022