Three good growth stocks to buy now

Professional investor Algernon Percy picks three large international firms that can produce sustainable earnings growth over the long term.

Each week, aprofessional investor tells us where he'd put his money. This week:Algernon Percy of the Waverton Portfolio Fund

I prefer to invest in large international firms that can produce sustainable long-term earnings growth, thus compounding returns over many years. This is the most beneficial strategy for investors who want to preserve or enhance their long-term wealth, because it minimises the leakage from tax and trading costs that comes with a higher-turnover fund. The bulk of Waverton's stock-picking efforts are directed towards quality growth companies: shares such as Compass, Prudential and Lonza represent the core of the Waverton Portfolio Fund. Traditionally, consumer staples such as Procter & Gamble and Coca-Cola would represent the backbone of a portfolio like this, but investors' risk aversion, together with extremely low bond yields, have made them expensive, so the only firm of that nature we hold at present is Reckitt Benckiser. We prefer to concentrate on more economically sensitive companies that still offer long-term growth, such as Compass, WPP and Lockheed Martin.

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Algernon Percy is manager of the Waverton Portfolio Fund