Saturday, February 2, 2008

Tips from Axa's star stock-pickers

From thisismoney:

Experience is what is required to manage investment funds in today's challenging stock markets, so claim many financial advisers. If they are right, Nigel Thomas and George Luckraft fit the bill perfectly.

The Axa Framlington pair have it in bucketloads - more than half a century between them - though it hasn't immunised their funds against the violent slide in the UK stock market that took place last week and resulted in 'Black Monday', the biggest one-day market fall since September 11, 2001.

...But over the past year, in particular, both funds have underperformed. 'As a fund manager, I got screwed by the market last year,' admits Luckraft, hands in air. 'More than 40% of the assets of the two funds were in small-cap stocks and they fell in value 20%. I hate underperforming. It's something that hurts.'

...So, Thomas has his fund set up very defensively. This means a big concentration on FTSE 100 stocks - representing 46% of the portfolio - and an emphasis on defensively minded stock market sectors such as industrials, oil and gas and utilities.


Thomas is also massively underweight in financials and consumer goods, shares that are hyper-sensitive to the fortunes of the UK economy. He holds no banks, property companies or housebuilders. The result is a fund dominated by household names such as BG Group, BP and Unilever and Thomas sees no reason to change the fund's defensiveness. 'I'm happy with where the fund is,' he says. 'I'm worried about future bank earnings and I'm still concerned about many of the housebuilders....MORE

£700m British Gas in 'profiteering' row

British Gas is to unveil record profits of nearly £700m at a time when millions of customers have been hit by vastly increased bills.

The figures represent a rise of more than 600% on the £95m the business made in 2006. And they will add momentum to claims of profiteering by the power giants.

Gas and electricity suppliers cashed in last year because they failed to pass on the full value of falls in wholesale costs to customers....