My fund picks for 2025

There’s a lot that’s uncertain as we head into 2025. One thing we do know, however, is that there’s a Trump shaped elephant in the room. The red sweep in the US Presidential election paves the way for a very different economic and market backdrop in the year ahead.

Trump 2.0 is likely to be characterised by tariffs, tax cuts, immigration curbs and less regulation. It could lead to more divergence, making asset allocation more challenging - and important. The US looks likely to grow faster at the expense of its rivals, notably Europe and China. But much of that is already priced into a more highly rated stock market.

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Inflation might be a bit higher than expected but shouldn’t be far above target. Interest rates can still come down through the year. Equities continue to look like the asset class of choice as earnings pick up the baton from valuations, even if long-term return expectations have moderated. The bull market is closer to its end than its beginning but it’s not yet flashing red.

So, my fund picks aim to participate in the Trump Trade while tilting away from the higher priced parts of the US market. As last year, my preference is to be well diversified. I’m looking to tap into the value that’s still to be found in financial markets beyond America’s tech stock leadership.
 

Important information - The value of investments and the income from them can go down as well as up so you may get back less than you invest. Investors should note that the views expressed may no longer be current and may have already been acted upon. Eligibility to invest in an ISA/SIPP and tax treatment depends on personal circumstances and all tax rules may change in the future. Withdrawals from a pension product will not be possible until you reach age 55 (57 from 2028). Past performance is not a reliable indicator of future returns. The Brown Advisory US Smaller Companies Fund, Dodge & Cox Worldwide Global Stock Fund, Fidelity Global Dividend Fund and International Public Partnerships Limited (INPP) Investment Trust invest in overseas markets so the value of investments could be affected by changes in currency exchange rates. The Dodge & Cox Worldwide Global Stock Fund and Fidelity Global Dividend Fund use financial derivative instruments for investment purposes, which may expose the funds to a higher degree of risk and can cause investments to experience larger than average price fluctuations. The Dodge & Cox Worldwide Global Stock Fund invests in emerging markets which can be more volatile than other more developed markets. The Fidelity Global Dividend Fund invests in a relatively small number of companies so may carry more risk than funds that are more diversified. This Brown Advisory US Smaller Companies Fund invests more heavily than others in smaller companies, which can carry a higher risk because their share prices may be more volatile than those of larger companies and the securities are often less liquid. The Brown Advisory US Smaller Companies Fund and Dodge & Cox Worldwide Global Stock Fund, have or are likely to have, high volatility owing to its portfolio composition or the portfolio management techniques. The shares in the International Public Partnerships Limited (INPP) Investment Trust are listed on the London Stock Exchange and their price is affected by supply and demand. The investment trust can gain additional exposure to the market, known as gearing, potentially increasing volatility. The Key Investor Information Document (KIID) / Key Information Document (KID) for Fidelity and non-Fidelity funds is available in English and can be obtained from our website at www.fidelity.co.uk. Please note that Tom’s picks and Select 50 are not a personal recommendation for you. If you are unsure about the suitability of an investment you should speak to one of  Fidelity’s advisers or an authorised financial adviser of your choice.