The CCM Intelligent Wealth Fund is an international equity fund. The reason for this is because international equities, as measured by the MSCI World Index, have had a consistently better performance track record than the FTSE All Share Index over the last 1, 3, 5 and 10 years.
One of the reasons for this is because the UK stock market makes up just 4.41% of world stock markets by capitalisation. So in other words, there are far more opportunities to grow your money by investing in an international equities fund rather than in a solely UK one. Don’t just take my word for it.
In the FT Weekend Money pull out section on 27 April 2019 Merryn Somerset-Webb stated that there was a lack of international equities funds to invest in UK. Especially ones that are easily comprehensible, one stop shops for investors wanting diversified, but very active and intelligent exposure to the global equity market. I tend to agree. Hence the reason why the first fund we launched was the CCM Intelligent Wealth Fund.
Most, if not all, fund managers in the majority of countries worldwide suffer from what’s known as home bias. In other words, they invest most of their money into their own domestic stock market. It maybe makes more sense if the fund manager is based in the US as American stocks constitute 39% of world stock markets by capitalisation. However, the UK’s share is less than 5% meaning there are boundless opportunities to invest elsewhere in the world with potentially greater prospects for investment growth.
Another reason for home bias is because of the foreign currency risk. A large swing in exchange rates could turn an annual gain into a loss once the currency exchange rate is factored in.
Whilst ours is an international equity fund, we have recently shifted the focus of it more to UK equities, but not because of home bias. It is purely because the UK stock market is undervalued due to Brexit worries so it offers excellent value for money currently. We have also started investing into Japanese companies because the Japanese stock market is cheap too. We started reducing our holdings in US stocks in early January because the US stock market has become over-valued due to its record historic 9-year bull run hitting the buffers in the last 3 months of 2018.
So if you would like to invest in an international equities fund what are you waiting for? Contact us to find out how to invest in the CCM Intelligent Wealth Fund today. You know it makes sense.
