In the Chinese year of the Tiger, we consider the animal’s attributes of bravery, competitiveness and confidence - characteristics represented in many of the emerging market economies that now generate over 65% of global growth.*
In e-commerce, semiconductors, fintech, artificial intelligence (AI) or renewable energy, emerging market based companies have become synonymous with innovation and disruption.
So, if you are looking for growth, not only can you explore emerging markets through Templeton Emerging Markets Investment Trust (TEMIT) - some smart ways to invest can offer tax benefits too!
*Source: IMF WEO, October 2021.
Individual Savings Accounts (ISAs) and Self invested personal Pensions (SIPPs) are still a great way to invest in the stock market thanks to their flexibility and the tax benefits they offer.
Source: HM Government
Allowances for 2023/24 – deadline 5 April 2024
(or 100% of earnings if lower)
Allowances for 2023/24 – deadline 5 April 2024
Allowances for 2023/24 – deadline 5 April 2024
The video below shows the value of a £20,000 investment – the current ISA allowance – over the last five years. It’s clear that EM equities returned more than UK equities or a representative bank account.
And TEMIT tops the chart, beating its benchmark and returning over £5,412 more than UK equites (FTSE All Share) – that’s over £1000 per year on average. It’s important to remember that these returns are not a guide to future.
The annual allowance for SIPPs is currently £40,000 and have a range of advantages including tax relief and the ability to take some tax-free cash. As they are more complicated, we recommend seeking financial advice before making any decisions.
Children have their own tax-efficient allowances too. A Junior ISA allowance is £9,000 and Junior SIPPs allowance is £3,600. They offer the same benefits and tax advantages and are an easy way to take the first steps of an important investment journey.
Note that the money in Junior ISA’s can’t be accessed until the age of 18 when it becomes a ‘normal’ ISA and money in a Junior SIPP is safely locked away until retirement.
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You can invest up to £20,000 annually in an ISA before 5 April 2023 – and don’t forget that any unused portion will be lost.
A brand-new tax year does start the following day and your full allowance is fully refreshed.
Shares in TEMIT qualify as an investment which can be held through an ISA. TEMIT is available through a stocks and shares ISA from a number of different companies. Your financial adviser will be able to give you full details of the options available to you.
Important Legal Information
This website is intended to be of general interest only and does not constitute legal or tax advice nor is it an offer for shares or invitation to apply for shares of the Templeton Emerging Markets Investment Trust (TEMIT). Nothing in this website should be construed as investment advice. Opinions expressed are the author's at publication date and they are subject to change without prior notice. Subscriptions to TEMIT can only be made on the basis of the latest available audited TEMIT annual report and TEMIT half-yearly report if published thereafter.
The value of shares in TEMIT and income received from it can go down as well as up, and investors may not get back the full amount invested. Past performance is not an indicator or a guarantee of future performance. Currency fluctuations may affect the value of overseas investments. When investing in a fund denominated in a foreign currency, your performance may also be affected by currency fluctuations. An investment in TEMIT entails risks which are described in the TEMIT annual report. In emerging markets, the risks can be greater than in developed markets. Investments in derivative instruments entail specific risks more fully described in the TEMIT annual report.
US Persons are not eligible to invest in TEMIT. Shares of the TEMIT are available for sale and distribution in the UK. Any research and analysis contained in this website has been procured by Franklin Templeton Investments for its own purposes and is provided to you only incidentally.
References to particular industries, sectors or companies are for general information and are not necessarily indicative of TEMIT's holding at any one time.
References to indices are made for comparative purposes only and are provided to represent the investment environment existing during the time periods shown. An index is unmanaged and one cannot invest directly in an index. The performance of the index does not include the deduction of expenses and does not represent the performance of any Franklin Templeton fund.
MSCI makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used as a basis for other indices or any securities or financial products. This report is not approved, reviewed or produced by MSCI.
There is no guarantee that TEMIT will achieve its objective. Please consult your financial adviser before deciding to invest. You can download a copy of the latest TEMIT annual report and TEMIT half-yearly report, or request one, free of charge, from Franklin Templeton Investment Management Limited, Cannon Place, 78 Cannon Street, London EC4N 6HL. Authorised and regulated by the Financial Conduct Authority. Telephone: 0800 305 306, Email: [email protected].
