Nitin Bajaj: this market rally has legs
Nitin Bajaj of Fidelity Asian Values believes the stockmarket rally will continue for some time yet.
After years of lagging growth stocks, some scepticism from investors about the recent rally in value is justified. However, Nitin Bajaj tells Citywire’s Gavin Lumsden that he believes the rally has legs. “In the year 2000, we were already six months into the style rotation out of growth into value and people were still questioning whether growth was going to come back... my sense is that this time, it’s going to be very similar.” He expects the trend to continue for “a few years at least”.
Bajaj has been running the Fidelity Asian Values (LSE: FAS) investment trust – which specialises in small-cap value stocks – since 2015. The fund holds around 100 stocks out of a possible 18,000 and Bajaj keeps around 20% of the fund in large stocks in order to “manage my liquidity”. In the past five years the share price has gained around 94%, underperforming the benchmark index at 114%, although as Lumsden notes, it has beaten its rivals in the same sector.
One trend Bajaj likes now is “toll roads of technology”. Rather than try to pick specific winners in the consumer product area, he buys the stocks that underpin the whole sector. For example, he owns chipmakers SK Hynix and Taiwan Semiconductor (TSMC). Whichever phone wins the most market share, the chips inside it will be made by one of these firms. “You’ll never get the same upside that you can in a product company because a product can become a hit, but a product will also, most likely fail over time. TSMC doesn’t fail.”
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
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 to Money Morning
Our team, led by award winning editors, is dedicated to delivering you the top news, analysis, and guides to help you manage your money, grow your investments and build wealth.
-
8 of the best properties for sale with striking gardens
Properties with striking gardens – from a 17th-century longhouse in Carmarthen, Wales, to a 16th-century manor house in Hampshire with formal parterre gardens.
By Natasha Langan Published
-
Lloyds Bank Group closures to hit nearly 300 in 2025
Lloyds Bank Group is to close its doors to another 55 branches next year. Which ones are closing?
By Vaishali Varu Published
-
Which British stocks offer the best quality and growth?
A professional investor highlights British stocks that hit the sweet spot. This week, Alexandra Jackson, manager of Rathbone UK Opportunities Fund, picks three favourites
By Alexandra Jackson Published
-
US stocks plummet – is it time to buy bonds?
US stocks have taken a dive – should you keep your focus on US markets or turn your head to bonds?
By Alex Rankine Published
-
Are shares disconnecting from reality?
What effect is passive investing having on shares, and are ETFs going the same way?
By Alex Rankine Published
-
The peak of the AI frenzy has passed
When did the AI frenzy peak and what does it mean for tech companies?
By Alex Rankine Published
-
The battle against heart disease and how to invest in it
Heart disease is soaring due to rising obesity and an ageing population. But new drugs, treatments and diagnostic tools are on the way.
By Dr Matthew Partridge Published
-
Woodside Energy: an undervalued energy play
Woodside Energy offers a cheap way to invest in the growth of the global LNG market. Should you invest?
By Rupert Hargreaves Published
-
Small caps: how to ride the recovery wave of UK equities
Professional investor Ken Wotton highlights British small caps that hit the sweet spot of the British equity market
By Ken Wotton Published
-
Investing in defence: the easiest way to buy into the boom
The defence sector has taken off, but the opportunities for stock picking are more limited. We explain what to buy
By Frederic Guirinec Published