sterling

Another bruising year for investors?

The UK's current account deficit widened faster than expected in the third quarter to reach a record high of £27bn.

Managers have been grappling with the strong pound this year, as UK companies with overseas earnings have been hindered by currency strength. But that headwind will turn in to a tailwind in 2015, OMGI's Stephen Message predicts.

With currency moves increasingly dominating financial headlines, Tilney Bestinvest's CIO has predicted hedging, not asset allocation, will be the key differentiator for investor returns next year.

Barings multi-asset manager Christopher Mahon has warned the chances of a fresh Black Monday-style crash are rising, as policy decisions increasingly drive markets.

Jupiter UK equity manager Steve Davies believes investors will need to be "tactically nimble" to handle the fallout from next year's UK election.

Sterling could fall much further against the US dollar if the UK's current account deficit is not addressed, bond managers have said.

PFS TwentyFour Dynamic Bond fund

Renewed dollar strength has led forecasters to predict a tougher time for sterling in the coming months, despite a small relief rally last week as Scotland opted against independence. Which funds could benefit?

The pound reached a two-year high against the euro overnight while yields on gilts and treasuries rose, as Scottish voters rejected independence from the UK and investors swapped safe havens for equities.