US Tech Lifts November Funds

Ben
Yearsley,
director
at
Shore
Financial
Planning
explains:
“The
US
is
leading
the
pack
with
growth
again
surprising
on
the
upside
with
third
quarter
annualised
figures
of
5.2%,
revised
up
from
an
initial
reading
of
4.9%.

“The
US
leading
the
global
economy
is
helpful
as
the
other
powerhouse,
China,
has
seen
falling
manufacturing
PMI
numbers
below
the
magic
50
showing
contraction
is
on
the
cards,
but
October
retail
sales
soared
7.6%
year
on
year.
In
Germany,
business
confidence
has
picked
up
albeit
from
low
levels
–
the
German
economy
shrank
0.1%
in
the
third
quarter.”

China
equity
funds
occupy
the
majority
of
the
bottom
50,
alongside
a
few
bond
funds
(due
to
the
strength
of
the
pound)
and
thematic
agriculture
and
natural
resources
strategies.

However,
it
was
largely
a
good
month
for
bonds.
As
central
banks
are
keeping
interest
rates
fixed
and
inflation
seems
to
be
heading
down,
European
bonds,
gilts
and
US
Treasuries
are
all
rallying
at
the
expectation
that
rates
could
be
coming
down
next
year.

The
best
overall
performer
in
November
was

Nikko
AM
ARK
Disruptive
Innovation
which
has
been
a
fixture
in
our
bottom
10
multiple
times
this
year,
including
October.
It
is
a
European
version
of Cathie
Wood’s
famous
ARK
Innovation
ETF (which
had
a
torrid
2022)
and
is
advised
by
ARK
Investment
Management.
Over
November
the
fund
soared
25.18%,
bringing
the
yearly
return
up
to
41.67%.
We
await
the
December
figures
to
see
whether
it
will
feature
in
the
top
funds
for
2023.

Also
breathing
a
sigh
of
relief
is
Baillie
Gifford,
one
of
the
asset
managers
taking
the
largest
hits
by
the
value
rotation
of
the
past
two
years.
Its

American
fund,
down
50%
in
2022,
grew
17.77%
in
November.

Janus
Henderson
Horizon
Pan-European
Property
Equities
completes
the
top
3
with
a
15.79%
gain.
It
is
the
only
fund
with
a
single-digit
return
for
2023
in
the
top
10.

Meanwhile,
China
is
still
struggling
to
get
its
economic
recovery
going
following
the
Covid-19
pandemic
and
an
ongoing
property
debt
crisis.
In
November
the
worst
performing
fund,

Neuberger
Berman
China
Equities,
fell
6.64%.
This
brings
the
fund’s
overall
2023
return
to
a
negative
24.97%.

As
my
colleague
Kate
Lin
recently
discussed
with
Morningstar’s
associate
director
for
manager
research,
Bryan
Cheung,
China
funds
were
hit
by
$7
billion
in
outflows
over
Q3.

In
a
video
interview,
he
said:
If
you
look
at
the
forward
PE
of
China
equity,
they
are
among
the
lowest
versus
the
major
EM
countries,
implying
a
better
return
potential
in
the
longer
term.
And
for
the
near
term,
confidence
needs
to
improve
for
investor
interest
to
return,
which
could
take
some
time.
Nonetheless,
the
government
is
still
pro-growth
to
reach
its
GDP
growth
target.
While
much
of
the
negative
news
is
likely
in
the
price,
it’s
always
difficult
to
time
the
market’s
inflection
point.
So,
we
think
investors
should
try
to
prepare
rather
than
to
predict
the
broad
market
movements.”

Watch
Kate
and
Bryan’s
conversation
on
whether
you
should
buy
the
dip
here.

Three
non-China
funds
also
made
it
onto
the
bottom
10
list:

T.
Rowe
Price
Global
Government
Bonds,

Guinness
Global
Energy,
and

T.
Rowe
Price
Funds
Dynamic
Credit
–
all
with
a
Morningstar
Medalist
Rating
of
Silver.

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