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.

IF you want some certainty amid all the turmoil, at least when it comes to your investments, odds are you have already begun investing in gold. That was a wise move; this treasured ‘safe haven’ has seen a surge in value since war in Ukraine began.

The gold price is trading above $2,000 an ounce - the first time it has been that high in 19 months, as investors have sought comfort from his safe haven asset.

Gold Price chart

None

Source: Investing.com, gold price in USD terms from 8.3.21 to 8.3.22

Other metals too have seen their prices surge, with fears of a shortage of physical metals adding to the price hike. The London Metal Exchange saw "unprecedented movements” and was forced to suspend trading in nickel yesterday (Tuesday) after prices more than doubled to $100,000 a tonne.

But the gold price is not the only safe haven asset to have soared in recent days. And it is not the only way to protect your money during these uncertain times.

As always a diversified portfolio is key. It can be tempting to sell investments and hold cash, but you will only be locking in losses that will have been made as markets have reacted to the unfolding events between Russia and Ukraine. And don’t forget we are also dealing with a high and potentially very high rate of inflation.

Rather than battening down the hatches and switching to cash, you are likely to be far better off building resilience into your investment portfolio.

Shares in companies that have strong corporate balance sheets and pricing power on their side can also prove to be winners. While it may feel as though pouring new money into stocks and shares is unwise as stock markets remains volatile, investing in high-quality companies with solid balance sheets, that have strong pricing power, including those in the UK, can be one of the best ways to counter rising inflation.

Indeed, some emerging markets, like Brazil, where some equities are well placed to take advantage of higher commodity export prices, could do particularly well. And that includes China. With its economy showing signs of stabilising and its central bank in stimulus mode and following a policy of domestic resilience, investors in Chinese companies may find they are insulated from the worst of price rise pressures we are going to increasingly see elsewhere in the world. Select 50 funds like Fidelity Sustainable Asia Equity Fund and JPM Asia Growth Fund are a way of tapping into these opportunities.

In the Fidelity Select 50 Balanced Fund, manager Ayesha Akbar actively positions the fund across different regions and asset classes using the broad range of Select 50 funds available to her in this highly-diversified fund of funds. Maike Currie spoke to her last month on the fourth anniversary of the fund.

Five year performance

(%) As at 8 Mar

2017-2018 2018-2019 2019-2020 2020-2021 2021-2022
Gold 5.8 -5.3 19.0 7.2 18.6

Past performance is not a reliable indicator of future returns

Source: Investing.com, total returns in USD terms as at 8.3.22

Important information: Investors should note that the views expressed may no longer be current and may have already been acted upon. The Fidelity Select 50 Balanced Fund invests in overseas markets and so the value of investments can be affected by changes in currency exchange rates. It also invests in emerging markets can be more volatile than other more developed markets. This fund uses financial derivative instruments for investment purposes, which may expose the fund to a higher degree of risk and can cause investments to experience larger than average price fluctuations. There is a risk that the issuers of bonds may not be able to repay the money they have borrowed or make interest payments. When interest rates rise, bonds may fall in value. Rising interest rates may cause the value of your investment to fall. Currency hedging is used to substantially reduce the risk of losses from unfavourable exchange rate movements on holdings in currencies that differ from the dealing currency. Hedging also has the effect of limiting the potential for currency gains to be made. The Fidelity Select 50 Balanced fund investment policy means it invests mainly in units in collective investment schemes. There are just a few fixed limits for the three core elements in the fund. These are 30% to 70% for shares, 20% to 60% for bonds and 0% to 20% for cash. Tax treatment depends on individual circumstances and all tax rules may change in the future. This information is not a personal recommendation for any particular investment. 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.

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