Key takeaways:
- CT Global Managed Portfolio Trust is constructed with three long-term investment themes in mind.
- To expose your savings to the best opportunities, it’s generally good practice to stay invested for the long term.
- Jumping in and out of a fund quickly means you may not give yourself enough time to see these three long-term investment opportunities come good.
When it comes to investing, it’s generally good practice to have a long-term time horizon in mind. The longer you remain invested, the longer your savings will have to grow, and the better they will weather any short-term volatility (ups and downs). But most importantly, the fund manager of CT Global Managed Portfolio Trust makes decisions based on the long-term prospects of asset classes, regions, and sectors. So, if you jump in and out of the fund quickly, you may not have given yourself enough time to see the investment come good.
The words ‘long-term’ and ‘investing’ often go hand in hand. Those that take the plunge into the world of equity investing generally plan to stay there for at least three years. Investing isn’t a quick-fix solution.
There are several reasons for this, including the simple fact that the longer you stay invested, the more time your savings will have to grow. More time equals more opportunity. It also allows you exposure to compound interest, or accumulated interest. That’s interest on top of interest on top of interest, and it adds up surprisingly quickly.
For example, you may invest £100, which grows by 5% in the first year, up to £105. In the second year, your savings may grow by another 5%, taking you up to £110.25. The same thing happens in the third year, your savings grow by 5% again and now you have £115.76. By the 10th year of 5% growth, your savings are worth £162.89. The longer you spend in the market, the more your savings could benefit from the power of compounding.
Long-term investing also helps you ride out any short-term bumps, commonly known as volatility. It can be stressful to see a drop in the value of your savings, but if you choose to sell during a dip, your losses will be crystalised. If you can withstand the market turbulence and stay invested, you could eventually see your savings recover. Markets don’t stay still. The longer you stay invested, the better chance your savings have to weather any short-term bumps.
Investment decisions are generally made in the context of long-term social, political, and economic themes. So, staying invested for the long term also aligns your time horizon with that of CT Global Managed Portfolio. Fund manager Peter Hewitt and his team carefully scan the globe for the best long-term opportunities for their fund of funds. And it’s the long-term part that’s key here; they are not anticipating these investments come good overnight. By staying invested for the long-term, you are most likely to see your savings benefit from these long-term global themes.
Long-term opportunities in CT Global Managed Portfolio
Peter Hewitt and his team carefully construct CT Global Managed Portfolio based on thorough fund research, in the context of long-term global trends. As a global fund of funds*, CT Global Managed Portfolio offers exposure to many different sectors, such as healthcare and technology, and asset classes, such as private equity and UK equities.
But these various sectors and asset classes rarely generate consistently positive returns from day one. Some investments may be considered good long-term opportunities as they are trading cheaply today and set to rise in value in the next two to three years. Investment success rarely happens overnight. It can be more of a waiting game. The opportunities in CT Global Managed Portfolio are no different.
CT Global Managed Portfolio focuses on three long-term investment themes. The first is UK equities, with a bias to medium and smaller-sized companies which offer growth at attractive valuations. The second theme is funds with long-term growth characteristics, typically with holdings in technology and healthcare. CT Global Managed Portfolio’s third area of focus is private equity trusts, with strong underlying growth characteristics which are trading at good value.
These are all attractive long-term opportunities which CT Global Managed Portfolio is well placed to capitalise on. The outlook looks positive for equity markets with inflation trending meaningfully lower, which could pave the way for lower interest rates. Lower inflation and lower interest rates create a more favourable environment for equity markets. But staying invested for the long term gives your savings the best chance of success.
A waiting game
*A fund of funds means a fund which is comprised of various other carefully chosen funds.
Investment Risks
The value of your investments and any income from them can go down as well as up and you may not get back the original amount invested. Gearing is used for investment purposes to obtain, increase or reduce exposure to an asset, index or investment. The use of gearing can enhance returns to investors in a rising market, but if the market falls the losses may be greater.
