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issue 16 – JULY 2016 www.masterinvestor.co.uk The UK's no.1 free investment publication Time for Take-Off HOW GROWTH IN GLOBAL AIR TRAVEL CAN LIFT YOUR PORTFOLIO plus... JIM MELLON ON BREXIT MASTER INVESTOR OUTLINES A PATH FORWARD Special Dividends THE SMALL CAPS THAT PAY YOU EXTRA The Future of Medicine HOW TO INVEST IN IMMUNOLOGY AND SYNTHETIC BIOLOGY Pocket the Grey Pound THE FUNDS THAT HOPE TO PROFIT FROM AN AGEING POPULATION Superior Investor Support -ID9F:5GH&=J9-<5F9*F=79G #Bl89DH<-HC7?'5F?9H5H5 &9J9@Q5B8F95?=B;(9KG /%*F9A=IA-<5F9<5H [email protected]=HH9FGIDDCFH KKK@G97CI? London Southeast A4 Full Page Advert Final.indd 1 29/03/2016 12:51 WELCOME Out of the EU, and into the world! Dear Reader, This e-magazine was, from day one, proudly associ- ated with the campaign to see the United Kingdom leave the European Union. It was a bold step at the time. Back when we first started writing about "Brexit", the upcoming referendum had barely started to regis- ter on the mainstream media's radar. Anyone I asked about the subject told me: "The status quo always wins in referenda; there will never be a majority to leave the EU." How wrong they were! CONTACTS Master Investor isn't a political organisation, nor will we aim to call other elec- Advertising tions. We do, however, feel strongly about Britain as an investment destination. [email protected] Short-term adjustments aside, our team, on the whole, feels strongly that Britain will benefit economically from the decision to cut itself loose from the decaying Editorial Enquries political union that the EU has become. This is a nation of free enterprise, risk [email protected] taking, and innovation. The City of London is the world's biggest financial centre and one that offers countless opportunities to private investors. Subscriptions [email protected] We expect Britain's lead in the world of finance to only become bigger. With it will come an even broader choice of investment opportunities. When this nation turns its primary focus away from the low-growth EU and toward high-growth FOLLOW US markets around the world, it will open up a variety of new investment opportuni- ties that private investors will be able to exploit. The unwinding of hedge positions; the necessary adjustments at large corpora- tions that chose to base their planning on one-sided politics rather than respon- sible scenario planning; and the temporary period of uncertainty over certain issues will cause some inevitable volatility. The longer-term outlook, however, is bright. exclusive book offer The real problems now lie with the countries that remain in the EU, where issues such as the insolvency of the Italian banking sector will have to be resolved – with- for mi readers out financial contributions from Britain. To get The Naked Trader 4 Our team and our entire network of contributors will continue to cover these for just £10 unfolding events during the months to come. We are excited, confident, and opti- mistic about Britain's future outside of the EU and the prospects that offers for plus P+P in investors. paperback CLICK HERE Best regards, and use the promo code: Swen Lorenz, Editor, Master Investor NTMI0615 If you think you have what takes to be a CLICK HERE TO WANT TO Master Investor contributor then email us at SUBSCRIBE CONTRiBUTE? [email protected] Master Investor Ltd. Editorial Contributors Disclaimer Suite 88 Robbie Burns Samuel Rae Material contained within the Master Investor Magazine and its website is for general information pur- 22 Notting Hill Gate poses only and is not intended to be relied upon by individual readers in making (or refraining from John Cornford Nick Sudbury making) any specific investment decision. Master Investor Magazine Ltd. does not accept any liability London W11 3JE Filipe R. Costa for any loss suffered by any user as a result of any such decision. Please note that the prices of shares, United Kingdom Caroline Drewett spreadbets and CFDs can rise and fall sharply and you may not get back the money you originally invested, particularly where these investments are leveraged. Smaller companies with a short track James Faulkner record tend to be more risky than larger, well established companies. The investments and services Editorial Richard Gill, CFA mentioned in this publication will not be suitable for all readers. You should assess the suitability of Editor Swen Lorenz Victor Hill the recommendations (implicit or otherwise), investments and services mentioned in this magazine, and the related website, to your own circumstances. If you have any doubts about the suitability of Editorial Director James Faulkner Adrian Kempton- any investment or service, you should take appropriate professional advice. The views and recom- Creative Director Andreas Ettl Cumber mendations in this publication are based on information from a variety of sources. Although these are Sub Editor Simon Carter John Kingham believed to be reliable, we cannot guarantee the accuracy or completeness of the information herein. Jim Mellon As a matter of policy, Master Investor Magazine openly discloses that our contributors may have interests in investments and/or providers of services referred to in this publication. www.masterinvestor.co.uk | Master Investor is a registered trademark of Master Investor Limited ISSUE 16 – JULY 2016 | 3 issue 16 – JULY 2016 www.masterinvestor.co.uk The UK's no.1 free investment publication CONTENTS Time for ISSUE 16 – JULY 2016 Take-Off HOW GROWTH IN GLOBAL AIR TRAVEL CAN LIFT AVIATION YOUR PORTFOLIO plus... Time for Take-Off – How Growth in Global Air Travel Can JIM MELLON ON BREXIT 016 MASTER INVESTOR OUTLINES A PATH FORWARD Lift Your Portfolio Special Dividends THE SMALL CAPS THAT PAY YOU EXTRA The aviation industry looks set to enter a glorious new era. The world is indeed The Future of Medicine HOW TO INVEST IN IMMUNOLOGY getting smaller. Here's how to profit from it. AND SYNTHETIC BIOLOGY Pocket the Grey Pound THE FUNDS THAT HOPE TO PROFIT FROM AN AGEING POPULATION on the cover 006 Mellon on the Markets Inside the mind of a Master Investor: Jim Mellon lays out a route map for Brexit. 034 Funds in Focus – If You Can't Beat Them, Join Them ALL OTHER TOPICS It is estimated that the number of older people in the world – defined All aboard the Brexit Big Dipper as those aged 60 or over – will in- 010 crease from 901 million to more than Victor Hill looks at the outlook for UK investments in the aftermath of the UK’s vote to 1.4 billion over the fifteen years to leave the EU. 2030. Nick Sudbury looks at the funds looking to capitalise on this trend. 022 How to Invest Like... John Templeton 038 From Acorns to Oak Filipe R. Costa distils the investment strategy and processes of John Templeton, the Trees – Special-Divi- man who popularised overseas diversification and ran one of the best performing dend Special mutual funds of all time. Special dividends can be particularly Dividend Hunter – Debt-Free Dividend Investing valuable to investors. Richard Gill, CFA, 028 uncovers the small-cap companies that As demand for investment into high-growth businesses skyrockets, the City is pay you extra. looking to crowdfunding to open the door to the masses of untapped and enthu- siastic retail investors. 044 Opportunities in Focus – Forget "Pharmaceuti- 052 Chart Navigator – Take Me up the North West Passage cals" – Think Immu- Adrian Kempton-Cumber gets technical. This month, Adrian looks at the potential nology and Synthetic for global realignment should the Arctic ice cap continue to recede, and reveals Biology how investors can position themselves accordingly. Victor Hill takes a look at two of the emerging disciplines which could trans- form medicine within our lifetimes: immunotherapy and synthetic biology. 4 | ISSUE 16 – JULY 2016 Master Investor is a registered trademark of Master Investor Limited | www.masterinvestor.co.uk All other topics 058 Robbie Burns' Trading Diary 082 Best of the Blog 'Naked Trader' Robbie Burns looks at how traders can – and must – remove their We look back at some of the most pop- ego from their trading activities. ular pieces from the Master Investor Magazine website during the month of June. 086 Read to Succeed – The Laws of Wealth Richard Gill, CFA, reviews The Laws of Wealth, in which Dr Daniel Crosby at- tempts to take the behavioural finance discipline to the next level, by analysing the theory behind investment psy- chology and then suggesting ways to become a better investor. 062 The Macro Investor – The Death of Bonds Over the last few years, investors have been trying to front run central banks by purchasing bonds. However, Filipe R. Costa believes that the gains could be about to come to an end. 068 Forensic Forex – Where Next for Sterling Author and trader Samuel Rae looks at how the Brexit vote will play out in the Sterling markets in the coming months. 090 The Final Word – Soldiers of Fortune Adrian Kempton-Cumber calls it as it is. This month, the AKC explains why there's no room for sentimentality in trading. 072 The Sorry Tale of Stanley Gibbons John Cornford uncovers the story behind the demise of the philately specialist. 078 Millennials & Money – Crowdfunding: Is It worth the Effort? The power of the masses is at your fingertips, where collective ideas, resources 094 Markets in Focus and strategies can be readily tapped into by the budding entrepreneur. Crowd- Market data for the month of June. funding can offer something for everyone, argues Caroline Drewett. 4 | ISSUE 16 – JULY 2016 Master Investor is a registered trademark of Master Investor Limited | www.masterinvestor.co.uk www.masterinvestor.co.uk | Master Investor is a registered trademark of Master Investor Limited ISSUE 16 – JULY 2016 | 5 BY JIM MELLON Mellon on the markets Brexhausted! I'm now back in Spain after being in the UK on the day of and the morning after the referen- dum.