HEAD-TO-HEAD: Pinebridge versus T Rowe Price

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Darius McDermott, Chelsea Financial Services and Fund Calibre

Introduction

Many strategists have advised a cautious investment approach for the second half of this year, wary about an intensification of the Sino-US trade dispute and nervous that the US and European economies might slow significantly.

A typical preference is for high quality assets, which is shorthand for US Treasuries or, at a stretch, solid investment grade bonds. Equity markets are less secure, even S&P 500 stocks which continue to hit new historical peaks.

However, the G20 summit in Osaka last week provided some encouragement that a thaw might be imminent in the trade conflict, with the US and China both agreeing not to add any further tariffs for the time-being, and President Trump partially lifting the sanctions on Huawei.

Meanwhile, the dovish stance of the US Federal Reserve and the possibility of an interest rate cut this month, has provided nervous investors with some reassurance, despite continuing fears that corporate earnings in the US and worldwide will slide further.

It is a particularly unsettled environment for equity investors. In theory, funds with mandates that allow them to allocate to any equity market should have an advantage: they can choose the best and avoid the worst prospects.

On the other hand, it imposes greater pressure on them to get it right. They cannot simply hide behind a narrowly-based index to explain poor performance.

FSA asked Darius McDermott, managing director of Chelsea Financial Services and Fund Calibre to compare two global equity products. They are the Pinebridge Global Focus Equity Fund and the T Rowe Price Global Focused Growth Equity Fund.

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