US interest rate cuts and a slowing global economy have overshadowed the financials sector and banks in particular so far this year. With banks trading close to multi-year lows, Polar Capital Global Financial (PCFT)’s managers have been adding to positions in their favoured stocks… Read more
The managers believe that banks boast far more robust balance sheets and much healthier lending exposures than they did a decade ago, when they were emerging from the global financial crisis. PCFT’s managers feel that, barring the deepest of recessions, banks are materially undervalued. Any positive shift in sentiment, could trigger a rerating in what remains the largest sector in most indices. For a UK-based investor, PCFT offers a much more diverse exposure to the financials sector than an investment in those banks listed in the UK. Since its launch in 2013, PCFT has also delivered returns well ahead of those stocks (see page 9), while paying out an attractive dividend yield.
Growing income from financials stocks
PCFT aims to generate a growing dividend income, together with capital appreciation. It invests primarily in a global portfolio, consisting of listed or quoted securities issued by companies in the financial sector. This includes banks, life and non-life insurance companies, asset managers, stock exchanges, speciality lenders and fintech companies, as well as property and other related sub-sectors.
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