Husselbee swings from defensive to risk assets

North’s John Husselbee has shifted exposure across his multi-manager growth portfolios, adding 6% to risk assets and cutting back defensive positions.

The firm’s chief executive swapped cash and bonds in mid-March to add 2% in China, 2% in Japan and 2% in US exposure.

Husselbee boosted his position in the £620m First State Greater China Growth fund, run by Martin Lau.

“China is one of the first countries that began to tighten monetary policy and we see it as one of the first to come out the other end. The environment now seems appropriate for an easing of policy and it is a market that certainly lagged in the last 12 months.”

He says Japan was inexpensive relative to history and other markets, even before the recent tragic events hit the country.

“The one ingredient that was missing in Japan – for the authorities to provide liquidity and stimulus to the market – is now a given because they need to rebuild the country. But they require a weaker yen and we have now seen intervention on an international scale to help that devaluation.”

Husselbee is playing this theme by adding to the £47m Martin Currie Japan Alpha fund. He also holds the £209m AXA Framlington American Growth fund and a passive Vanguard fund for exposure to the US. 

“The US continues to be positive, suggesting the economy is strengthening. There are fears over the impact of QE2 ending in June, but corporate earnings are there, companies are profitable, so they have the margins and they have the cash.

“The AXA Framlington American Growth fund has a particular bias to tech – that reinvestment comes in capex, as rebuilding tech is an obvious place for industries to spend their money.”

He says the Vanguard tracker only has an annual management charge of 20 basis points, making it a low-cost and effective way to tap the market.