Sometimes investing is more about what you avoid than what you hold. Here, the Chinese BATs* stocks provide a case in point. Posting eye-watering returns through 2017 and the first half of 2018, these former darlings of the tech world fell significantly in value through the course of the year as fears mounted over the pace of Chinese growth and the implications of the US trade war began to bite.
For investors who were counting on China tech gains to continue to hold up, 2018 may well have presented something of a wake-up call as the power of negative numbers ate into their total returns. Investors with an eye on income however will have banked their dividends and come out of this volatile ride a lot better.
Zoe Kan, portfolio manager. Newton, a BNY Mellon company
* BATs is an acronym for three stocks in the Chinese tech sector: Baidu, Alibaba and Tencent