POLAR CAPITAL GLOBAL FINANCIALS TRUST: Make money from the big banks
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Investment trust Polar Capital Global Financials offers investors the chance to make money from some of the world's leading financial brands – such as JPMorgan, Mastercard, Visa and Warren Buffett's Berkshire Hathaway. Though a specialist fund that should form only a small slice of a diverse investment portfolio, its appeal is obvious. With more than half of its assets in the US, it provides an alternative avenue into the country's booming stock market.
Its financial focus means it does not hold any of the so-called 'magnificent seven' US growth stocks – Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia and Tesla – which have been largely responsible for driving the US equity market ever higher. According to the fund's managers, the relative valuations of many US financial stocks remain compelling compared to the wider US stock market despite a recent rally. In other words, they are relatively cheap and have the potential to ratchet up in price.
Also, the investment team at Global Financials believes that incoming US President Donald Trump will help create an economic and fiscal backdrop conducive to financial-orientated businesses (banks, consumer finance providers and alternative asset managers) doing well.
Lower business taxes, falling interest rates, lighter-touch regulation of the banks, modest inflation and an economy that steers clear of recession should all mean bigger revenues and profits for financial companies. . The trust, with a market capitalisation of just below £600million, has more than half of its assets in the United States. It is run by a triumvirate of managers – Nick Brind, George Barrow and Tom Dorner – brimming with experience of running financial funds.
