Munro puts cash to work in technology stocks
There is a seismic shift taking place in technology which will be a benefit for the Munro Global Growth fund, although the outlook is “murkier” for what the new normal will look like after the pandemic.
This shift was affecting holdings in the Munro Global Growth fund including payment provider PayPal, software firm Atlassian and social media giant Facebook, although only Facebook sat in the fund’s top 10 largest holdings at a 3.9% weighting.
Munro chief investment officer Nick Griffin said PayPal and Atlassian had been two of the fund’s biggest contributors to performance during May alongside renewable energy company Orsted, Alphabet and software firm ServiceNow.
“We see a seismic shift occurring in the adoption of digital transformation at both enterprise and consumer levels. Consequently, we see an acceleration ahead for many of our investments.”
In April, the fund had a 14% weighting to cash but this had since fallen to 6% in May and Griffin said the fund was fully invested and was protecting against the downside through hedging tools rather than holding cash.
However, he was hesistant about what the world would like in the future as the world re-emerged from the pandemic.
“The outlook is murkier due to a range of issues including a second COVID-19 wave, social unrest and increasing trade tensions.”
The Munro Global Growth fund has returned 24% over one year to 29 May, according to FE Analytics, versus returns of 8.5% by the global sector.
Performance of Munro Global Growth fund versus global sector over one year to 29 May, 2020
AUTHOR
Laura Dew
Recommended for you
Outflows from an Australian private markets fund manager have caused FUM at Pacific Current to decline by $1 billion in the last quarter.
Former RIAA chief executive Simon O’Connor has joined the ethical advisory panel at U Ethical Investors.
Financial services leaders are “all cashed up with nowhere to grow” when it comes to M&A activity, according to Deloitte, with 90 per cent saying they have strong balance sheets ready for an acquisition.
As fund managers are urged to diversify their product ranges, they are finding a faster way to do this is via an acquisition of existing firms but experts say it is not without potential culture clashes.
