BGF World Energy - demand to remain high through end of the year
Between the BGF World Energy and the Franklin Natural Resources funds, my money on the $BGF World Energy Fund(LU0368265418.MF$ to outperform the Franklin Natural Resources fund.
With prospects of a slowdown in China growth in the near term, this would dampen demand for both energy and materials.
However, the conflict in Europe continues to put pressure on energy needs globally. While the USA is said to have increased stockpiles, OPEC and Russia are doing the opposite with reduced production to keep prices inflated.
Winter on the horizion for the northern hemisphere could see an increase in energy demands into spring of 2024. That said, betting on increased stockpiles in the USA alone might not be sufficient to meet global consumption needs.
With 68% sectorial allocation to Energy, the Franklin Natural Resources fund may not be able to capture most of the shorter term energy demand when compared to the BGF World Energy fund. The Franklin fund has a significant allocation to materials but if we are on topic of Brent, energy demand fueled gains, then the BGF fund is all or nothing.
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