With interest rates edging lower, valuations diverging and geopolitics reshaping global markets, portfolio positioning is coming under renewed scrutiny. In this article, we examine how fund managers from the Chelsea Selection, across six key regions, are allocating capital, the sectors they favour and where they see the most compelling opportunities as the year begins.
Past performance is not a reliable guide to future returns. You may not get back the amount originally invested, and tax rules can change over time. The views expressed are those of the author and fund managers and do not constitute financial advice.
UK
Richard Hallett, manager of the IFSL Marlborough Multi-Cap Growth fund, has more than half of his assets divided evenly between two sectors: industrials and financials*. The fund, which aims to provide capital growth and outperform the FTSE All-Share Index over five-year periods, is usually concentrated in 40 to 70 names. Its largest individual holding is Close Brothers Group*, the UK merchant banking business, which has seen its stock price soar 71% over the past year**.
In his latest update, Richard noted that outflows weighed on UK market valuations but noted that share buybacks and ongoing M&A were shrinking the pool of listed companies. “While patience is still required, we believe the environment is becoming increasingly favourable for a re-rating of quality growth stocks,” he said.
Global
Diversification is a crucial element of the Ranmore Global Equity fund. It doesn’t have large individual stock positions but favours a broad spread of sector exposures. Its top 10 holdings account for just over a fifth of assets under management, with high-street baker Greggs serving up the largest allocation of 2.5%***. We regard this fund as something of a hidden gem. Its performance has been particularly impressive given its value style and bias towards mid and smaller-cap names.
Recently, fund manager Sean Peche said his favoured companies were those with strong balance sheets and a long history of generating positive free cash flow. “We are also diversified across regions, perhaps even more important in these times of rapidly changing political relationships and global trading patterns,” he added.
North America
There’s no surprise that the AXA Framlington American Growth fund is packed full of the world’s leading technology companies. This portfolio focuses on innovative businesses with unique brands and the kind of intellectual property that can keep rivals at bay. It’s why NVIDIA, Apple, Alphabet, Microsoft and Amazon remain its largest holdings*, despite those companies having enjoyed bumper stock price hikes.
The fund, which aims to provide long-term capital growth over periods of at least five years, will have at least 80% of its assets in large and medium-sized companies listed in the United States. We believe its focus on strong growth also allows it to benefit from exciting, less-researched companies in the US market.
Asia Pacific excluding Japan
Asia’s bustling information technology sector is home to industry giants such as Samsung Electronics, and they feature in the Invesco Asian fund*. This portfolio, led by William Lam, aims to achieve long-term capital growth by investing in companies whose share prices are below Invesco’s fair-value estimates.
In a recent update, the managers argued that Asia presented a “powerful case for inclusion” in the portfolios of investors seeking diversification and long-term value. Currently, they have a modest overweight position in Hong Kong and China, with a mix of large internet companies, life insurers, and consumer-related stocks*.
“While geopolitical risks, such as US trade tariff policies, remain a concern, many Asian companies have strong balance sheets and competitive advantages that may support resilience,” they noted.
Japan
Fanuc, a global leader in factory automation, is one of Carl Vine’s favoured stocks^, the manager of the M&G Japan fund, due to its robotics opportunities. “We are optimistic on the management’s ability to pursue this new growth area, and increased our holding accordingly,” he wrote in a recent update. He also highlighted SBI Shinsei Bank, whose IPO the fund participated in during the month, as one of the portfolio’s top contributors in late 2025.
The fund, which can invest in Japanese companies of any size, aims to get under the skin of potential holdings. It’s also very concentrated, typically holding fewer than 60 stocks. Industrials has the largest sector allocation, followed by financials and information technology. Toyota, Hitachi, and Sony, meanwhile, are among its 10 largest individual positions*.
Emerging Markets
China, Taiwan and India are the three highest geographic exposures of the FSSA Global Emerging Markets Focus fund*. The aim of the portfolio, whose lead manager is Rasmus Nemmoe, is to achieve capital growth over the medium to long term. It classifies this as at least three years. It invests at least 70% of its assets in the shares of large and mid-sized companies, which usually have a market capitalisation of at least US$1 billion.
Currently, Taiwan Semiconductor is the largest individual holding, with a 9.6% share of assets, followed by Tencent Holdings with 6.9%. Information technology has the largest sector share at 26.5%, followed by financials at 26% and consumer discretionary at 23.8%*.
