Alex Crooke, Portfolio Manager of The Bankers Investment Trust (BNKR), talks about the impact of rising input costs (wages and raw materials) on companies, areas where he is finding opportunities and the benefits of global diversification in a volatile market environment.
Global equity markets have struggled this year, with sentiment largely dominated by concerns over rising inflation and the prospect of faster-than-expected central bank tightening. The war in Ukraine, higher energy prices, and persisting supply chain disruptions have also served as a headwind.
We are investing cautiously in China and are focusing more on defensive areas such as health care. However, the governments zero-Covid policy remains a risk to the country’s economic growth.
Companies are using nearshoring to reduce costs and supply chain disruptions. By having certain elements of their manufacturing closer to home, they can reduce transportation costs and have more control over their processes.
With economies, sectors and businesses are all on different cycles – having a globally diversified portfolio has helped us provide investors with a smoother, less volatile ride as the risk is spread across different regions/sectors.
These are the views of the author at the time of publication and may differ from the views of other individuals/teams at Janus Henderson Investors. Any securities, funds, sectors and indices mentioned within this article do not constitute or form part of any offer or solicitation to buy or sell them.
Past performance does not predict future returns. The value of an investment and the income from it can fall as well as rise and you may not get back the amount originally invested.
The information in this article does not qualify as an investment recommendation.