Hak Salih: UK facing sovereign debt crisis

Santander's Hak Salih has been increasing his fund's exposure to defensive stocks, believing the UK economy will remain volatile for a number of years.

The manager of the £156m Equity Income fund says Britain’s high level of debt remains a problem and sterling is likely to be weaker over the longer term. As part of his defensive stance he has built a 4.9% position in tobacco with the addition of holdings in British American Tobacco and Imperial Tobacco. This year has also seen him develop a 10.6% weighting in utilities and 11.6% in pharmaceuticals. “In Western economies we have been playing pass the parcel with debt, first it was corporate, then consumers and now sovereigns,” he says. “The next stage of the crisis is a sovereign d...