Nick Train: protectionism is the biggest threat

It's not inflation and rising interest rates investors should be worried about, reckons fund manager Nick Train. It's protectionism.

Nick Train, manager of the Finsbury Growth & Income Trust and co-founder of Lindsell Train, isn't worried about inflation or rising interest rates hitting his portfolio. Investors shouldn't "make the category error of conflating growth companies with bond proxies" (companies that pay decent dividends but don't grow much), he says.

For example, "Unilever... has compounded its dividends by 8% a year since 1952". And don't be scared off by above-average price/earnings (p/e) ratios. Studies show that "exceptionally rare companies that can compound steadily for decades... can readily justify p/es of 30, 40 or more times".

Subscribe to MoneyWeek

Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Get 6 issues free
https://cdn.mos.cms.futurecdn.net/flexiimages/mw70aro6gl1676370748.jpg

Sign up to Money Morning

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Sign up
Dr Matthew Partridge
Shares editor, MoneyWeek

Matthew graduated from the University of Durham in 2004; he then gained an MSc, followed by a PhD at the London School of Economics.

He has previously written for a wide range of publications, including the Guardian and the Economist, and also helped to run a newsletter on terrorism. He has spent time at Lehman Brothers, Citigroup and the consultancy Lombard Street Research.

Matthew is the author of Superinvestors: Lessons from the greatest investors in history, published by Harriman House, which has been translated into several languages. His second book, Investing Explained: The Accessible Guide to Building an Investment Portfolio, is published by Kogan Page.

As senior writer, he writes the shares and politics & economics pages, as well as weekly Blowing It and Great Frauds in History columns He also writes a fortnightly reviews page and trading tips, as well as regular cover stories and multi-page investment focus features.

Follow Matthew on Twitter: @DrMatthewPartri