+79.30% – great results of the 1st year of my mutual funds’ wallet

A year ago I opened my ISA account with AXA. Since that, I have been investing in the global stock markets and commodity funds. The results are much better than I expected.

The chart above shows the performance of my investments vs benchmarks – FTSE100, FTSE 250 and SP500. My wallet performance was +79.30%. FTSE100 gained +21.87%, FTSE250 gained +3.68%, and SP500 went up 22.39%.

I was informing my readers about this wallet in the posts:
– post from 3 of April 2016
My investments in £
– post from 19 of April 2016
Fundamental Valuation Ratios – why I invest in Russia and Poland and I am not so keen on investing in UK shares
– post from 20 of June 2016
+21.38% in 4 months – results of my investment wallet in £
– post from 7 of July 2016
Fundamental Valuation Ratios – a focus still on Russia, Poland and China stock markets
– post from 18 of August 2016
+48.50% in half a year – a summary of my investment wallet in £ on my ISA account

Asset class in my wallet:

• Equities on the world stock markets

Neptune Russia & Greater Russia C Acc GBP – Equity mutual fund

It grows when there is a bull market on the Russian stock market and when there is growth of the currency ratio Russian ruble to British pound

Henderson China Opportunities I Acc (GBP) – Chinese and Hong Kong Equity mutual fund

It grows when Chinese and Hong Kong stock markets grow and when there is an upside in the currency ratios of those markets

My comment: Russian and Chinese stock markets are two the cheapest stock markets. Although the potential of growth is not as big as a year ago, I still want to have my money on the markets mentioned above. What is more, I still see the potential of growth of the Russian currency.
Last year, Russian ruble appreciated its value vis-à-vis British pound +48.62%, Chinese yuan appreciated its value vis-à-vis British pound  +9.92%, Hong Kong dollar appreciated its value vis-à-vis British pound +15.45%.
The  return last year:
Henderson China Opportunities I Acc (GBP)
+50.42%
Neptune Russia & Greater Russia C Acc GBP
+83.66%

• Commodity/Energy

JPM Natural Resources C Acc (GBP) – the commodity fund

It has exposure to the companies in Canada, the USA, Russia and Australia. It gains when commodities prices are going up and also when currencies of the countries mentioned above are gaining vis-à-vis the British pound.

Investec Global Gold I Acc Net (GBP) – the commodity fund

It grows when the gold price is going up.

My comment: it seems that after a long bear market in the commodities, last year the situation started to change. The oil, copper and aluminum prices are going up. I want to have exposure to the companies which are benefiting from this phenomenon. The fund JPM Natural Resources C Acc (GBP) gained in the last year +91.62%.
The similar situation is about gold. There was also a bear market, lasting for as long as 4 years, however, last year that worrying trend started to change.
The risk related to investing in the fund Investec Global Gold I Acc Net (GBP) is that the change in the valuation of the fund is much bigger than just the change in the price of gold. In the last year, the gold price in British pound gained +17.66% while this fund gained +50.65%. It is because when the gold price grows, the earnings of the mining companies grow a few times more. We can say that any change in the price of gold of 10% implicates a change in the fund valuation of 30%. So be careful while investing in such funds.

Current holdings in the wallet are like on the graph below:

– Neptune Russia & Greater Russia C Acc (GBP)
44.46% of the wallet
– JPM Natural Resources C Acc (GBP)
33.59% of the wallet
– Investec Global Gold I Acc Net (GBP)
12.21% of the wallet
– Henderson China Opportunities I Acc (GBP)
9.74% of the wallet

In the next post, I will tell more about ISA and why it is worth to use it. In a nutshell, it is a way to invest your money preventing it from taxes. If you want to use ISA allowance for 2016/2017, you had better hurry up – you have time for it until 5 April 2017.