For individual investors in the UK

Cutting through the noise: The cost of living crisis

In this podcast series, Portfolio Manager, Jamie Ross, and Portfolio Analyst, David Barker, give investors an insight into the research, discussion, and analysis that shapes and influences their investment decisions.

Jamie Ross, CFA

Jamie Ross, CFA

Portfolio Manager


3 Nov 2022
1 minute watch

Key takeaways:

  • With consumers spending less on non-essential items, the consumer discretionary sector has been one of the worst-hit. In contrast, consumer staples companies such as Nestle have been more resilient.
  • The portfolio has no exposure to the automotive sector: auto manufacturers have benefitted from constrained supply and therefore strong pricing over the last 18 months. However, pricing could weaken as supply comes back into the market.
  • Within industrials, stock selection has been key. We have been adding exposure to semiconductor equipment companies, including ASM and BE semiconductor as they stand to benefit from structural growth trends such as higher digitalization, the 5G upgrade cycle, and increased demand for more advanced chips.

Jamie and David talk about the cost-of-living crisis, its impact on companies within the consumer discretionary, consumer staples, autos, and industrials sectors and how it has impacted their investment decisions.

 

These are the views of the author at the time of publication and may differ from the views of other individuals/teams at Janus Henderson Investors. Any securities, funds, sectors and indices mentioned within this article do not constitute or form part of any offer or solicitation to buy or sell them.

 

Past performance does not predict future returns. The value of an investment and the income from it can fall as well as rise and you may not get back the amount originally invested.

 

The information in this article does not qualify as an investment recommendation.

 

Marketing Communication.

 

Glossary

 

 

 

Important information

Please read the following important information regarding funds related to this article.

Before investing in an investment trust referred to in this document, you should satisfy yourself as to its suitability and the risks involved, you may wish to consult a financial adviser. This is a marketing communication. Please refer to the AIFMD Disclosure document and Annual Report of the AIF before making any final investment decisions.
    Specific risks
  • If a Company's portfolio is concentrated towards a particular country or geographical region, the investment carries greater risk than a portfolio diversified across more countries.
  • The Company may have a particularly concentrated portfolio (low number of holdings) relative to its investment universe and an adverse event impacting only a small number of holdings can create significant volatility or losses for the Company.
  • Where the Company invests in assets which are denominated in currencies other than the base currency then currency exchange rate movements may cause the value of investments to fall as well as rise.
  • This Company is suitable to be used as one component in several in a diversified investment portfolio. Investors should consider carefully the proportion of their portfolio invested into this Company.
  • Active management techniques that have worked well in normal market conditions could prove ineffective or detrimental at other times.
  • The Company could lose money if a counterparty with which it trades becomes unwilling or unable to meet its obligations to the Company.
  • Shares can lose value rapidly, and typically involve higher risks than bonds or money market instruments. The value of your investment may fall as a result.
  • The return on your investment is directly related to the prevailing market price of the Company's shares, which will trade at a varying discount (or premium) relative to the value of the underlying assets of the Company. As a result losses (or gains) may be higher or lower than those of the Company's assets.
  • The Company may use gearing as part of its investment strategy. If the Company utilises its ability to gear, the profits and losses incured by the Company can be greater than those of a Company that does not use gearing.
Jamie Ross, CFA

Jamie Ross, CFA

Portfolio Manager


3 Nov 2022
1 minute watch

Key takeaways:

  • With consumers spending less on non-essential items, the consumer discretionary sector has been one of the worst-hit. In contrast, consumer staples companies such as Nestle have been more resilient.
  • The portfolio has no exposure to the automotive sector: auto manufacturers have benefitted from constrained supply and therefore strong pricing over the last 18 months. However, pricing could weaken as supply comes back into the market.
  • Within industrials, stock selection has been key. We have been adding exposure to semiconductor equipment companies, including ASM and BE semiconductor as they stand to benefit from structural growth trends such as higher digitalization, the 5G upgrade cycle, and increased demand for more advanced chips.