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Which funds and trusts are you buying to cash in on the market correction?

01 July 2015

As is customary, FE Trustnet gives you the chance to get the open and closed-ended funds you’re thinking about buying analysed by industry experts.

By Joshua Ausden,

Head of FE Trustnet Content

At close of trading yesterday the FTSE was down 8.21 per cent from its 7,104 peak back in April, teetering on the edge of a "technical correction." The European stock market has indeed surpassed the 10 per cent figure. 

Worries over Greece's increasingly inevitable exit from the eurozone has been the biggest driver of the falls, though imminent rate hikes in the US and the slowdown in China have certainly contributed to profit-taking. 

Performance of indices since 27 April 2015



Source: FE Analytics

An 8 per cent correction is certainly not something to get too worried about if you're a long-term investor. A recent article by FE Trustnet showed just how insignificant the likes of Black Monday and the 2011 eurozone crisis appear when looking at long-term returns, which the graph below emphasises.

Performance of index since 1984



Source: FE Analytics

Nevertheless, a pull back in the market gives an investor the chance to put cash to work at a lower level than the day or week before. Yesterday I decided to bring forward my monthly savings plan and top up an existing holding in Alex Wright's Fidelity UK Smaller Companies fund, for example. 

Are you using the recent soft-patch to buy into a fund or investment trust? Or even if you are biding your time in the expectation that markets will continue to wobble, do you have your eye on a potential investment to cash in on cheaper valuations? 

If you’d like to get your picks analysed by experts including those in FE Research, leave the name of the funds and trusts and the reason why you’re backing them in the comments section below, or email us at editorial@financialexpress.net.

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Data provided by FE fundinfo. Care has been taken to ensure that the information is correct, but FE fundinfo neither warrants, represents nor guarantees the contents of information, nor does it accept any responsibility for errors, inaccuracies, omissions or any inconsistencies herein. Past performance does not predict future performance, it should not be the main or sole reason for making an investment decision. The value of investments and any income from them can fall as well as rise.