Tactical stock selection crucial to navigate US/China trade war
A tactical stock selection approach will be key for investors navigating the US/China trade implications, which means that they will need to understand that some sectors might be more affected than others, according to Premium China Funds Management (PCFM).
The firm said that sectors such as technology, transportation, commodities or energy might be hit slightly harder by consequences of the trade tensions. At the same time, the financial brokerage sector would be also expected to face possible higher volatility.
PCFM’s Jonathan Wu said that his both funds, Premium Asia Fund and Premium China Fund, had reduced their exposure to these sectors over the last six months, particularly to export-oriented Chinese companies.
“We expect both nations are motivated to strike a deal and the near-term market volatility will not be a major concern for long term investor in the Chinese equity markets,” he said.
“In the Premium Asia Fund, our holdings in information technology sector are mainly Taiwan and South Korea companies, which the impact would be much indirect from this round if trade talk.”
Recommended for you
T. Rowe Price believes Australian growth is successfully managing to shrug off consumer weakness, but the firm’s multi-asset team is not yet positive enough to increase its underweight position.
Iress has issued an update denying the validity of “certain statements” made by an alleged threat actor, following a cyber incident last weekend.
The latest budget papers have outlined a $10 million provision for ASIC greenwashing enforcement activity as well as funds for a sustainable labelling regime to be partially met by industry levies.
Betashares has expanded its fixed income solutions with the launch of a new ETF offering exposure to subordinated bonds issued by the big four Australian banks.
