JP Morgan Natural Resources

sorcerer

I am currently holding this fund in my ISA and have done for the last couple of years. But I pay into it every month, and every month the prices drops.

Was wondering what you thoughts are about this fund, and if you think it something that might bounce back in the future. I reliease it's impossible to predict the market. But compared to funds like Black rock Gold and General, its performance has been very bad.

I did think about stopping payment into it but holding what I have.

What do you think.

sabretoothtigger

Lowest since Aug 09
That is bad

http://www.hl.co.uk/funds/fund-discounts,-prices--and--factsheets/search-results/j/jpm-natural-resources-accumulation

Investigate all the companies it owns and see if they are decent choice or not

XTA and FCX are ok I think EGO owns Europe largest gold mine, coming on line soon hopefully

sorcerer

My concern is people have lost faith in the fund and fund manager, and that even if the fund has good fundamental shares it will still tank.

I realise this is a high risk fund, but I have lots of other high risk funds, such as Gold and India/Russia and none of these are performing anywhere near as bad as this one.

mr_fishbulb

I have the First State Global Resources fund which is also targeted at natural resources. It's done badly over the past couple of years because demand for natural resources is low.

It was down 20% a few months ago, and then I decided to start drip feeding into it again. Yeah it's crap now, but think of it as the opportunity to get resource stocks whilst they're cheap

sorcerer wrote: »

My concern is people have lost faith in the fund and fund manager, and that even if the fund has good fundamental shares it will still tank.

That could happen on on Investment Trust or ETF, but not a unit trust where prices are set against the underlying assets.

Jegersmart

I have recently started to allocate some funds to this one, it is unrealistic to expect that a fund of this type will perform well when the sector has been hammered......which is why I waited until now with an initial position. First Statae Global Resources is an alternative but you would need to compare the two and decide for yourself.

GL

J

Linton

Resources with any fund are a volatile investment. My view is that they are VERY much for the long term, it's a bet on increased global demand arising from increase in world population and increased industrialisation of the 3rd world.

My main concern with the JPM fund was its holding in gold as in my view gold isnt a natural resource investment. However this seems to be common across all resources funds.

I hold the fund and will continue to do so. If you are investing for the long term, now may be a good time to buy.

sabretoothtigger

My concern is people have lost faith in the fund and fund manager, and that even if the fund has good fundamental shares it will still tank.

That would be utter bunkum. Only fraud and excessive charges could derail a unit trust which owns good shares. I think fscs covers bad losses from manager failure so there is no reason, dont believe illiquidity is possible any more then the underlying stocks and they are all massive


The world is totally topsy turvey. Government debt is master of all money flows and yet what is the highest risk, government.
Theres no great reason for commodities to do badly especially if World GDP stays positive which is likely it will; just from the immense poverty existing and the will and efforts of those people to have a lightbulb, to eat 3 times a day.
Us in the west however may tighten belts of course but we are the minority, certainly of growth possible

JohnRo

It's just a reminder that investing is, to a very large extent and varying degrees, gambling on future outcomes. The only people who aren't gambling being those making a solid living from processing your investment capital.

The conundrum is that an investment doing well is reassuring but the boat has often sailed by the time that trend becomes clear. It may also be nothing more than a symptom of other, general market conditions and not anything in particular the investment managers are doing right, or wrong. The best time to buy is obviously when it is cheap and that means when it "isn't doing well".

I hold and feed in monthly to JPM natural resources and Jupiter India, amongst others, neither of which I'm especially happy with because both are down for me personally, so currently lowering my average cost since neither are "doing well" right now. The big question of course is will they improve and if so when.

I remind myself we are in the grip of a global slow down and unprecedented financial turmoil, so unless the whole capitalist system collapses or stays on life support for decades, a long term horizon should see money invested now bear fruit at some point. No guarantees of course, just my two cents.

sorcerer

I have about 12 years left before I wan't to de-risk and become more cash driven. So I have to consider is 12 years long enough for this fund not only to return to profit but also make me the 100% profit target I want to achieve. It certainly is a difficult decision to make.

grey_gym_sock

except for useless commodities like gold (which i won't attempt to discuss, but it certainly raises different issues), natural resources is broadly a bet on world economic growth. that can be growth in the rich, industrialized countries (who use the lion's share of natural resources), or more countries becoming industrialized.

with some resources, there is the further factor that they look set to be in very short supply in a few decades' time. that may mess up the world economy, but be good for owners of those resources. however, there is the complication that some commodities are related; so if (for instance) you own a mine of some base metal, which has soared in value, but it takes a lot of energy to extract the metal, and energy prices have also soared, then do you gain or not?

as with any investment, we can discuss the factors which might drive its performance, but it may be that all those factors are already in the price, plus a few more factors which we haven't noticed. on the other hand, the markets may have got it very wrong - it does happen.

grey_gym_sock

sorcerer wrote: »

I have about 12 years left before I wan't to de-risk and become more cash driven. So I have to consider is 12 years long enough for this fund not only to return to profit but also make me the 100% profit target I want to achieve. It certainly is a difficult decision to make.

not sure if you're planning this anyway, but the usual advice would be to de-risk gradually rather than all at once.

is that 100% total return, before or after inflation? even after inflation, that's perhaps a little high for equities generally, but not crazily high (it's about 6% p.a. compound). but while it's perfectly possible, it's not predictable, because equities tends to massively over- or under-shoot their average returns.

a fairly high target return doesn't make a case for a single-sector fund, unless you also believe in the investment case for the sector. "boring" sectors like equity income might achieve this return level if they have a moderately better than average period.