There is much to be optimistic about despite weaker economic growth and sovereign debt issues in the West. Of course, the financial problems in the US and Europe matter, but they are unlikely to halt the economic progress taking place in the emerging world or destroy their aspirations as urbanisation and development creates greater affluence and an increasingly aspiring middle class. 

Much of the recovery in the western economies will be due to this demand for basic goods and services, fuelled by the resilience of consumer spending around the world, and especially in emerging countries like China and India.

Investing through a global equity fund that focuses on this trend provides investors with a unique opportunity to benefit from this theme and is an ideal core holding for most portfolios.

Graham French joined M&G in 1989 as a graduate from Durham University where he studied geography. His fund management responsibilities include managing the M&G Global Basics Fund and the M&G Managed Growth Fund and co-managing the Vanguard Precious Metals & Mining Fund. 

Standard Initial Charge............5%  

Thomas Heald Discount...........5%

M&G Global Basics Fund

My pick for 2011 is the M&G Global Basics Fund which invests in companies considered to be the ‘building blocks’ of the world’s economy. The fund manager, Graham French, seeks to take advantage of global structural themes, such as rising incomes in developing economies, through positions in both ‘primary’ industries, companies involved in the extraction of raw materials, and ‘secondary’ industries, which are those involved in the conversion of materials into products.

The fund has a bias towards ‘asset-rich’ companies and those that the fund manager believes can grow independently of the economic environment. Graham seeks to identify those businesses that have a strong competitive advantage and a sustainable market share, a proven business model, financial strength and low valuations. As such, this fund makes a great core global holding.

Graham has an outstanding track record, being the number one in the IMA Global Growth sector since launch. It is also the most consistent fund in its sector – over its lifetime it has been top decile in more calendar years (eight out of nine) than any other fund*.

You can access the fund via Thomas' Top 20 or through our model portfolios 

*Source Morningstar and M&G Statistics as at 30.11.10, bid to bid, net income reinvested, based on Sterling Class A shares. Fund ratings are as at 30/11/10. Ratings should not be taken as a recommendation. The fund changed name and objective in November 2000. Graham French took over management of the Fund in November 2000.