Last week, while stock markets were falling and every piece of economic data created ‘double dip‘ headlines, we learnt that one of Britain’s most respected fund managers had slashed his fund’s cash holding by more than two thirds.

Philip Gibbs who runs the Jupiter Financial Opportunities fund with Guy de Blonay, had just over 41% of the fund’s assets in cash in June, but by July the figure had fallen to just 13.65%. The cash has been used to increase the fund’s exposure to all geographic regions, particularly Europe and the UK, but not North America. Gibbs has also moved out of the safe haven of gold in another of his funds. You can get more detail here: http://www.citywire.co.u...lls-out-of-gold/a426020

In fact, after five months in which fund managers reduced their allocation to shares, a Reuters poll of 11 big investors published today showed a marked move into these riskier assets.

The message? Fears of a return to recession may be overblown and UK companies with overseas earnings can make a mint.

Reuters’ Chris Vellacott quoted Andrew Milligan, head of global strategy at Standard Life Investments: ‘Concerns about a double-dip recession are certainly overblown. Too few investors look at economic history. In reality such events are really rather rare, especially once a private sector recovery has begun.’

While Alec Letchfield, chief investment officer for wealth at HSBC Global Asset Management, told the newswire: ‘In terms of positioning in the UK equity market, we would stress that thanks to the globally diversified nature of the UK equity market, only about a third of market-wide earnings come from the UK economy.’