AXA Framlington American Growth fund
Andy Parsons, head of investment research at The Share Centre, explains why America offers investors growth prospects and highlights the AXA Framlington American Growth fund.
"Despite the continuing global economic uncertainty, in particular surrounding the Eurozone, one region that is striving to break the shackles and help stimulate the global recovery is the US.
"Over recent months, economic data and news filtering out of this region has generally been positive, with much of it surprising industry experts by exceeding expectations and predictions.
"Whilst the economic position is undoubtedly improving, with GDP expected to be in the region of 2- 3% this year for the US, 2012 is a Presidential year and this is often seen as having a positive impact on the overall health of the nation. However, it should not be forgotten that in terms of debt, this is a nation that has significant issues to address and whichever party wins the race to the White House, co-operation and agreement within Congress to implement the necessary austerity measures has already shown to be near on impossible through discussions so far.
"North America is also the largest economy on the planet today due to its ability to innovate, access investment and its strong distribution channels both internally and beyond its borders. There are very few countries in the world that do not have US brand and product penetration and our every day lives are affected by this nation in some form or other.
"The AXA Framlington American Growth fund is managed by Stephen Kelly who has been at the helm since February 1997. The underlying objective of the fund is to achieve capital growth through investment in North American stocks which may include Canada and Mexico, but with a medium to large cap bias. For a company to be included within the portfolio it must clearly display above average profitability, have quality management and good growth potential.
"Individual holdings are normally limited to a maximum of around 2% and the fund generally holds between 65-85 stocks. The fund currently has key holdings in companies such as Apple, Google and Coca-Cola.
"For those investors wishing to have American exposure particularly within the medium to large cap arena, then this fund should fulfil that need.
"In terms of performance, Stephen has clearly demonstrated over numerous time periods his ability to deliver. Over a 5 year cumulative period, the fund is ranked 2nd out of 66 with an impressive return of 39.22% compared to the sector average of 14.20%. In respect of a 3 year cumulative period, again it is ranked 2nd out of 85 with a return of 62.32% compared to the sector of 41.99%. The fund is also ranked 1st quartile over 1 year and on a year to date basis is ranked 4th out of 99 with a return of 7.25% compared to the sector returning 2.78%."