HL SELECT GLOBAL GROWTH SHARES

HL Select Global Shares announces its first investments

Managers' thoughts

Important information - The value of this fund can still fall so you could get back less than you invested, especially over the short term. The information shown is not personal advice and the information about individual companies represents our view as managers of the fund. It is not a personal recommendation to invest in a particular company. If you are at all unsure of the suitability of an investment for your circumstances please contact us for personal advice. The HL Select Funds are managed by our sister company HL Fund Managers Ltd.

Steve Clayton - Fund Manager

15 May 2019

We’ve just published the first completed holdings in our new HL Select Global Growth Shares fund. You can find out what we bought and why on the portfolio breakdown page.

View the portfolio breakdown

Here’s a quick look at how we’ve invested the money.

Be mindful that the breakdown of the fund shown was taken very early in the life of the portfolio. Lots of positions aren’t yet at their full size, which explains the high cash position shown in the holdings breakdown. The country breakdown takes no account of the cash in the fund, which is one reason why the holding in the US looks so high.

At that point we’d finished building more of our US positions than those elsewhere, especially in Asia. The next breakdown that we show will reflect the impact of further dealings and will look like a more balanced portfolio in terms of its sector and geographical split. We’re still dealing a small number of positions. As and when we complete those and reveal the stocks involved, there’ll be a shift in the balance of the fund.

Technology across the pond

From the thousands of companies listed all over the world, thirty four companies have made it in to the fund. Some we’re still buying, so we’ll keep them under wraps a while longer, but here are a few key themes amongst the names we are revealing today.

Over half the money will have been invested in North America, once dealings are complete, largely in the USA, but we’ve also bought CAE, a Canadian business that leads the market for providing pilot training and simulators.

There’s a strong technology tilt to our US holdings, and the portfolio as a whole. Internet giants Amazon and Google’s owner Alphabet make it in. We love their dominant positions in huge swathes of the modern economy.

We’re also backing ServiceNow, a cloud-based IT service provider that we think will grow like Topsy. Microsoft’s Windows and Office software suite are eternal franchises that we see throwing off cash, far into the future, and their Azure platform is at the cutting edge of cloud computing, so they’re in too.

Ageing populations mean rising numbers of poorly people. We’re backing niche healthcare businesses around the world. Like Masimo, which leads the market in measuring patient’s blood oxygen levels, or West Pharmaceuticals that dominates the market in sealing solutions for liquid pharmaceutical packaging.

In financial services we’ve chosen not to hold any traditional banks, instead we’re backing companies serving the vital payments market, like Paypal and Mastercard. Elsewhere in financials, Charles Schwab is a leading platform for self-directed investors in the USA.

Market leaders at home and east

The Best of British is in the fund too. Four names from our sister fund, HL Select UK Growth Shares are in the portfolio, including Burford Capital, the world’s leading litigation finance business, and drinks giant Diageo.

Over in Denmark, Coloplast leads the market to provide Ostomy and Continence care globally, whilst Christian Hansen, named the world’s most sustainable company in a recent survey, is using its strength in enzyme and pro-biotic science to develop natural solutions to challenges in human, animal and plant health.

In the eastern hemisphere, we’ve bought into Tencent, a leading Chinese internet company listed in Hong Kong, and Japan’s leading beauty company Shiseido. We’re still building our positions in a couple of niche Australasian businesses, so we’ll tell you about those at a later date.

Read our rationale

You can read about all of these companies and others in the portfolio breakdown, and see the rationales for why each share was chosen. We’ll be revealing a few more names in the next week or two, when we’ve finished building the positions. They won’t be household names, but we think they’re great businesses, well worth the time spent steadily accumulating them.

We’re really excited about the potential of this fund. We think the companies within it are capable of growing strongly for years to come.

Like any stock market investment, the fund will rise and fall in value from day to day, so you could get back less than you put in. Because we only hold a small number of companies, we expect performance will often be quite different to that of the wider market. Our investment stance is long term and we look forward to keeping you in touch with how the portfolio fares in the months and years ahead.

View the portfolio breakdown

More about HL Select Global Growth Shares

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