straw poll - sell european funds?

macmomo

Is it time to sell all European funds? Even the ones that have been doing really well lately? What does everyone think?

blinko

only you can really answer this yourself through your own research.

eg What made you buy them in the first place ?
do you tink that now is a good time to sell, have you reached your target/stop ?

Does you research indicate further gains/losses ?

macmomo

just worried that european investments might tank because of the problems with greece/ireland/spain/italy. I wondered what conclusions others had come to. Personally, I'm getting nervous. I hold Jupiter European Growth (had it for 10 years), it's done very well overall I think but I wonder if Europe is just not the place to be at all right now.

Ark_Welder

"The key to making money in stocks is not to get scared out of them"

Peter Lynch

gozomark

equities ? bonds ? cash ?

Reaper

I would check where the funds are invested. If they are not in the PIIGS and not in banking then they will be less affected, though a declining Euro may hit them. I have Barings German Growth and intend to keep it.

Personally I suspect European funds will drop far more than they should as fear has that effect, and I will be looking to buy in at some point if they do (though still not in the dodgiest bits, I'm not that brave).

Old_Slaphead

I will consider adding to European funds on stockmarket weakness. The 3 UTs I'm in have performed well over last couple of years.

macmomo

I've got £10k in the Jupiter European Growth Fund. It's done well recently; very well in the last 12 months. Its largest holdings are France and Germany, very little in PIIGS (probably almost negligible), but my concern is over the Euro ie having any investments in Euro areas. If the currency itself depreciates by a great deal won't that destroy the value of the fund no matter what? My current thought is to sell half my holding in the fund and then either buy in again at a lower price or if the price rises well I'll either buy in again and accept some loss or buy into something else. Is this hedging my bets or being a coward?!

mr_fishbulb

I drip-feed into a couple of European funds, which I plan to continue even if the news worsens - hoping that would give the fund managers opportunity to pick some good stocks which have only been brought down due to market fears, and not general problems with the company.

If I had index trackers then I'd probably be more concerned.

Loughton_Monkey

Are you referring to equity funds?

To concentrate on the current 'PIIG' problem misses the point, I think. Most long-term pension funds are (or should be) in equity funds. You need to be blind not to have noticed the huge volatility associated with current uncertainties, current debt issues, and political instabilities in oil-producing areas. These volatilities reverberate through the whole world - whether you are invested in Skandia European Equity or Neptune China.

[For those nearing retirement, or are in funds for 'shorter' terms than 'long-term' should ask the question whether to be in equities at all currently. But that's another issue.]

However, those in equities in the longer term should take a step back and look at the big picture - and not focus on relatively short-term issues. As I suggested in another thread recently, there has been (and continues to be) a trend of slow (but accelerating) transfer of wealth from West to East.

The West may have started with a bigger bank balance, but it is now being heavily depleted for a number of reasons:

• Paying itself too much.
• Not working hard enough.
• Building up a huge expensive bureacracy.
• Tolerating idleness and indeed promoting it through 'benefits'.
• Living on credit, with all its associated costs.

Until China makes the same mistakes, this trend must surely continue? [I use China as the largest example of 'Eastern' economies]

When a good fund manager wants to add, say, a logistics company to his protfolio, he will do 'fundamental research' into a selection of companies. The oldest and biggest company - when compared to a medium sized one - might show comparatively huge director salaries; a massive bureaucratic and sloppy administration department; a maintenance function with half the productivity of the smaller one; huge overdraft costs resulting from loans for repairs rather than investment.....

Well exactly the same thinking should go into investing in a global economy.

Admittedly, some parts of Europe [Germany for instance] don't carry quite the same 'baggage' that UK companies do, but taken as a whole, Europe has built its wealth on an unsustainable model that the rest of the emerging world simply does not have to copy. Argue, if you like, all aspects of 'social responsibility' as between West and East, but expect it to take decades before the emerging economies price themselves out of the market in the same way.

Meanwhile, this is why everyone should consider very hard where their long term funds should be invested. Greece is merely a bit of crab-grass in the lawn of life.

Old_Slaphead

macmomo wrote: »

Is this hedging my bets or being a coward?!

I'd say the former.

IMO it's never 'cowardly' to take a few profits and/or spread the risk around or hold cash in current climate.

Jupiter European has already come off several % over last month