Keeping your savings safe is a challenge. Shares worldwide have suffered a torrid August. Worse still, autumn, a typically volatile period, lies ahead. With a return to recession looming for America, a fund that looks to protect your cash rather than taking major risks looks like the right bet.
A good example is the Troy CF Trojan Fund, which focuses on sheltering capital, says Mark Dampier at Hargreaves Lansdown. That means it has a naturally defensive stance, something we’ve favoured for some while. Manager Sebastian Lyon invests in equities, bonds, commodities and cash. As the fund’s investments are spread across a range of assets, its performance returns have a low correlation to global equity markets.
Since the fund’s launch just over ten years ago, “returns have been exceptional”, says Dampier. “While our analysis suggests asset allocation” – ie, being in the right markets at the right time – “has been key, Sebastian Lyon’s stock picking also stands out as among the best of more than 1,300 funds we analyse.”
This is a unit trust, which means that the total expense ratio at 1.54% is higher than we generally like. But the fund’s philosophy looks sound. “We’re long-term investors, buying on weakness rather than selling on strength,” says Lyon.
His current holdings include inflation-linked bonds and international companies with strong brands and good cash flows. For now he’s steering clear of miners, banks, cyclicals, property and corporate bonds. Furthermore, 20% of the fund is in gold and gold shares, as Lyon “can’t see gold going down very far”.
Contact: 0845-608 0950.
Troy CF Trojan Fund top ten holdings
| Name of holding | % of assets |
|---|---|
| ETFS Gold Bullion | 6.58% |
| ETFS Physical Swiss Gold | 5.98% |
| 1.7/8% UK Index-linked Gilt 2022 | 5.58% |
| 2.5% UK Index-linked Gilt 2020 | 4.26% |
| Singapore T-bills | 4.16% |
| 1.¼% Index-linked Treasury Gilt 2017 | 4.01% |
| British American Tobacco | 3.88% |
| US Treasury 1.375% inflation-linked bond | 3.75% |
| US Treasury 1.25% inflation-linked bond | 3.48% |
| Microsoft | 3.07% |