SEB investment strategist picks out funds to “spice up” portfolios

Funds from SEB, Silk, and Goldman Sacks have been picked out by Johan Hagbarth, investment strategist with SEB in Sweden, as a way to spice up portfolios despite the ongoing uncertainty and risks associated with the global economy.

The suggestions – not strictly speaking recommendations according to the small print – are contained in a note published for investors in the Swedish market, and available on SEB’s local website.

The basis of the funds selected is that Hagbarth expects continued global growth next year, assuming that the sovereign debt crisis is properly managed.

In order to benefit from this growth, investors should spread their investments across several markets and asset classes, to improve the chances of benefiting from steady and positive returns. Once that approach is in place, it gives opportunity to “spice up” the portfolio with additional selections – such as the names mentioned below.

High risk, short term

SEB usually recommends investors take a five-year investment horizon. However, Hagbarth says that those who are looking for interesting funds over a shorter time period may wish to consider funds such as:

   – SEB Listed Private Equity (Lux acc), a global fund focused on listed private equity companies. With a limited number of holdings it points to a high risk, high reward strategy. However, should global growth pick up then returns would improve considerably as the value of the underlying companies will rise sharply.

   – Silk African Lions , a new fund in SEB’s offering in the Swedish market. The focus is fast growing African stock markets, which are often small and carry high risk.

   – SEB Rysslandsfond (Lux acc), a Russia equity fund that offers a play on the country’s wealth in commodities, its large holdings of foreign currency reserves, and the low valuations on the local stock market.

Longer term

Hagbarth picks out both the Indexbevis BRIC Hävstång and Goldman Sachs Next 11 as potentially rewarding emerging market plays for investors with a longer term investment horizon.

The Indexbevis BRIC Hävstång offers leveraged returns, which means investors should get 120% of the gain in the S&P BRIC 40 index, which consists of the 40 most liquid stocks in the BRICs. Should the index fall, investors lose a maximum of -30% according to the way the product is designed.

The GS Next 11 offers exposure to emerging markets around the globe, which all are characterised by large populations, good growth opportunities, and favourable demographics.


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