“While we are marginally overweight equities across the portfolios, we are not betting the ranch and choosing our geographical exposures carefully,” he said.
“We prefer domestically orientated sectors and are quite pro-mid cap, particularly in Europe and Japan, which are our biggest regional overweights.
“We have moved our exposure away from mega-stocks, such as mining and energy companies, into Japanese smaller companies and mid caps across the board. We are double-weighted to Japan – neutral to the yen – and like consumer discretionary stocks.”
Wilson also tweaked his portfolio prior to the market fall.
“We bought some gold in August just before the market fall after taking some profits from US equities, which worked out quite well,” he said.
Having not made any significant portfolio changes since autumn 2011, Wilson prefers a “good house-keeping” approach, adding and taking off at the margins as markets move around.
Wilson is most positive on European and Japanese equities, which he accesses via the Henderson European Focus Trust and Schroder QEP Global Core Fund. However, he does not see the current environment as conducive to making hefty bets.
On the other hand, Stather-Lodge is confident that the slump will be short-lived.
“Markets are over-reacting,” he said. “We are not saying that our asset allocation will not be affected by the impact of a slowing Chinese economy – it will. Our conviction is that this wobble will recover and recent falls will be recouped.”
So how is Stather-Lodge applying this conviction to his investments?
