Investing in the brands Dads love this Father’s Day

UK shoppers are expected to splash out £700m on celebrating Father’s Day*, which takes place this coming Sunday (June 16). A recent survey reveals sons and daughters are expected to spend around £5m more this year than they did in 2023*. Dads, stepdads, grandads and fathers-in-law will be treated to gifts and meals out to celebrate the date, which has been a fixture on calendars for decades.

Here we look at the companies who may benefit from this upcoming spending bonanza – and the investment funds that own them.

For the tech lover

If the budget is pretty generous, then there’s no shortage of technological goods available from Apple, including iPhones, iPads and MacBook computers. The US tech giant is currently the largest holding in the CT Responsible Global Equity fund**, which is managed by Jamie Jenkins and Nick Henderson. The fund invests in quality growth companies from across the world but its responsible investing team makes this portfolio stand out from the crowd. We like the fund’s thorough process, with its in-depth, customised analysis of companies making for very considered stock selection.

Elsewhere, enthusiastic gamers, meanwhile, may be drawn to products from Microsoft, including the Xbox Series X. The company is the top position in the Comgest Growth America fund***, which is a highly concentrated portfolio of 25-35 companies. The fund, which is run by a four-strong team, aims to increase the value of the fund over the long term. It looks to achieve this by investing in high-quality, long-term growth companies. It benefits from a very clear process and experienced management team that have helped the fund deliver an outstanding performance

For the foodie

Chocolate is a popular option for Father’s Day and Nestlé, the Swiss confectionery giant, could benefit. Its brands include Aero, Quality Street, KitKat and Smarties. Nestlé is one of the largest holdings in the IFSL Evenlode Global Equity fund**, which aims to provide capital growth over rolling five-year periods. Its managers, Chris Elliot and James Knoedler, focus exclusively on quality companies that are able to achieve sustainable growth with the minimal need for additional capital. The fund has enjoyed considerable success as a result of both its investment process and Eddie, the in-house software system that helps them find high-quality, cash-generative businesses.

There’s a very good chance of finding a Diageo brand in the drinks cabinet of anyone who enjoys a tipple, as its beverages include Tanqueray gin and Johnnie Walker Black Label whisky. A holding in the Evenlode fund, the company is also one of the biggest individual names in the TM Redwheel Global Equity Income fund**, which aims to provide a combination of income and long-term capital growth.While the fund was only launched in late 2020, it benefits from a proven investment strategy and experienced team, led by Nick Clay. We believe this fund has a true contrarian nature that’s backed up by a logical and disciplined philosophy. The end result is an attractively yielding income fund.

For the world traveller

Holidays and weekend breaks are always a treat – and Easyjet could benefit from anyone looking to book a trip overseas. The low-cost airline is held by Simon Murphy in his VT Tyndall Unconstrained UK Income fund**, which is a mid-cap focused UK income fund. We believe this fund offers something different with its combination of premium yield and dividend growth stocks. Simon is also a very experienced manager and we like the fund’s high-conviction approach to active management.

For the luxury lover

Watches, jewellery and leather goods are among the many products available via LVMH, the French luxury goods specialist. The company is a holding in JPM Global Equity Income**, which invests in large to mega-cap stocks across the world, including the emerging markets. The team at the helm pays close attention to risk, while the focus on dividend growth should give investors a growing income stream. The fund’s investment process is built on the analysis conducted by JPM’s global research platform, which consists of more than 90 analysts.

We accept that buying the father – or father figure – in your life a car is probably not realistic for many people, but there may be some with bumper budgets. In that case, the AXA Framlington Japan fund may benefit as it holds positions in manufacturer Toyota^, whose vehicles include the Camry, Land Cruiser and RAV4. This fund, which is managed by the experienced Chisako Hardie, invests in firms with long-term growth prospects that are independent of short-term news flow. We like this fund’s clear and logical strategy – as well as the fact it’s well-diversified and has a valuation discipline.

*Source: GlobalData, 22 May 2024

**Source: fund factsheet, 30 April 2024

***Source: fund factsheet, 31 May 2024

^Source: fund factsheet, 28 March 2024