Value vs growth investing – 3 investment fund ideas for a portfolio

We recently did a deep dive into the age-old debate over which investment style is better – value, growth or something in between. We also looked at which style has done better in recent years and what could be next.

Value versus growth investing – the great rotation and what’s next

For part two, we’re sharing three fund ideas to help make the most of both styles.

This isn't personal advice. If you're not sure if an investment is right for you, ask for financial advice. All investments and any income they produce can fall as well as rise in value, so you could get back less than you invest. Past performance is not a guide to the future.

3 fund ideas

Investing in funds isn't right for everyone. Investors should only invest if the fund's objectives are aligned with their own, and there's a specific need for the type of investment being made. Investors should understand the specific risks of a fund before they invest, and make sure any new investment forms part of a diversified portfolio.

Jupiter Global Value Equity

Managers Ben Whitmore and Dermot Murphy employ a value focused approach. They look for unloved companies they think are attractively priced but have recovery potential.

The managers don't chase companies with high growth expectations, which they think can often be expensive. They like the unpopular or unfashionable ones whose shares can be bought for less than they think they're worth. This is a style known as value investing.

The way the managers invest mean they’re quite different compared to the broader global stock market. For example, they don’t invest much in typically high ‘growth’ sectors like technology and healthcare.

They favour investing in larger companies, spread across regions like Europe, the US, Japan, and higher-risk emerging markets. They’ll also invest in relatively few companies, including some higher-risk smaller companies, so each can have a big impact on performance, but it increases risk.

The managers’ ‘value' approach requires patience as it can take time for companies to recover, which is what we’ve seen recently. Companies within the more traditional value sectors, like financials, performed well as value came back into favour.

Whitmore has lots of experience in value investing and we think this bodes well for the fund over the long term, although there are no guarantees.

FIND OUT MORE ABOUT JUPITER GLOBAL VALUE EQUITY, INCLUDING CHARGES

JUPITER GLOBAL VALUE EQUITY KEY INVESTOR INFORMATION

Rathbone Global Opportunities

Lead manager James Thomson invests mainly in companies he thinks have the best long-term growth prospects. He also invests in companies he deems to be more stable that have tended to do well in both economic ups and downs.

Thomson and deputy manager Sammy Dow look off the beaten track to find companies they believe will grow over the long term. They normally find those among large companies from developed countries and avoid higher-risk emerging markets and smaller companies, although they can invest in them.

Thomson's long-term track record is excellent and has outperformed the IA Global sector average. More recently the fund's growth style of investing has posed a headwind though.

We think the manager is skilled at picking companies for their long-term growth potential, though that's no guarantee of future returns. Past performance also isn’t a guide to the future.

FIND OUT MORE ABOUT RATHBONE GLOBAL OPPORTUNITIES, INCLUDING CHARGES

VIEW RATHBONE GLOBAL OPPORTUNITIES KEY INFORMATION DOCUMENT

Troy Trojan Global Income

Lead manager James Harries aims to grow both capital and income over the long term. Harries adopts a blended style, preferring to approach the universe more conservatively, while also focusing on investing in high-quality companies. This approach means we expect the fund to hold up relatively well when markets fall, though like any investment it can still fall in value.

Harries and his deputy Tomasz Boniek invest in companies they view as financially sound. These companies also tend to provide goods or services that are in demand regardless of how well the economy is doing.

Troy sets a high standard when it comes to a company's quality and the managers mainly invest in large businesses from developed regions like North America and Europe. While they have the flexibility to invest in companies listed in higher-risk emerging markets, they tend to avoid them, preferring those that sell their products into these regions.

The fund invests in relatively few companies, so each can have a big impact on performance, both positively and negatively.

More recently, performance has been mixed. Harries’ blended style of investing means he’s captured some of the gains from the stronger performance of value orientated companies. But he’s also been hampered by some of the growth stocks he invests in, which have taken a hit over the last year.

The manager has the flexibility to use derivatives which, if used, increases risk.

FIND OUT MORE ABOUT TROY TROJAN GLOBAL INCOME, INCLUDING CHARGES

TROY TROJAN GLOBAL INCOME KEY INVESTOR INFORMATION

Past performance isn’t a guide to the future. Source: Lipper IM, to 28/02/2023.

*N/A = performance data for this time period is not available.