Would President Trump boost your nest egg?

SUPER Tuesday catapulted Donald Trump to front runner of the Republican candidates in the US Presidential Election. After claiming victory this week in seven states, the polls gave the businessman-cum-celebrity a 27pc chance of becoming the next US president.

But with a host of outlandish policies, not least building a wall across the border to Mexico, what would a Trump triumph in the November election mean for investors?

HEALTHCARE

ONE of Hillary Clinton’s campaign promises is that she will introduce regulation around drug pricing. Biotechnology and Healthcare funds, which had had an incredibly strong run over the past few years, took a major hit when she first broached the subject back in September.

The Pictet Biotechnology fund is down 19.7pc over the past three months, and the Axa Framlington Biotech fund has fallen 16.7pc over the same period. But a Trump victory could be good news for these funds as he has made no mention of capping the amount that pharmaceutical firms can charge for their products.

However, Adrian Lowcock, head of investing at Axa Wealth, points out: ‘Trump has said he believes in providing support for all but wants to repeal the Obamacare act and replace it with something else, though it’s not clear what. He could be good for the healthcare sector but his stance is quite contrary to the typical Republican beliefs so might not get much support.’

He also thinks insurance companies could suffer under a Trump regime. Part of Trump’s proposals include allowing health insurance firms to sell policies to people in other states than the company is based, something they cannot currently do. There is a risk that this could drive out smaller providers.

BUY Biotechnology funds. The Axa Framlington Biotech fund is down 16.7pc over the past three months, but it’s up 87pc over three years.

SELL Watch out with US funds with big holdings in insurance. For example the Jupiter North American Income fund has 8.5pc of its cash in non-life insurance companies, while the M&G North American Value fund has 3.9pc of its money in the sector.

THE WALL

ONE of the most striking promises Trump ( pictured) has made is to build a wall between the US and Mexico. If that goes ahead then construction firms are likely to benefit.

Ben Gutteridge, head of fund research at Brewin Dolphin, says it depends who will foot the bill for the construction as to which companies will benefit. If Mexico has to construct the structure then it will likely pick its own domestic firms to build it. He says: ‘Cemex is a Mexican building material company which could benefit if the wall did go ahead. However it does seem pretty implausible at the moment.’

Elsewhere, businesses which rely on a low-paid work force could be hit if the construction goes ahead. Lowcock says: ‘Hotels, restaurants and agriculture businesses are dependent of cheap labour, and would suffer if access to those employees dried up.’

The Republicans tend to spend more on defence, which is good news for companies such as engineering firm Meggitt and engineering company Cobham.

The party is also typically thought of as being better for the economy as they are pro-business, although history suggests that may not actually be the case. Fidelity research has looked at how the US economy has fared under each Government since 1928. On average the US stock market returned 10pc a year under Democrat leadership, compared to just 1.8pc under the Republicans.

The best stock market performance in that time was during Roosevelt’s second term when the market grew 24.2pc a year. Directly before him, under President Hoover’s four years in power, the stock market lost 24.7pc a year.

BUY Defence firms such as Meggitt and Cobham.

SELL An S&P 500 tracker fund which aims to match the performance of the US stock market.

EXPORTERS

THE infamous proposed wall will affect more than the building sector, of course. Emerging markets which are heavily reliant on the export of commodities such as oil could suffer if Trump introduces protectionist measures such as increasing tax on imported goods.

It would be good news for US firms though. They are likely to benefit from an increase in domestic demand and talk of cuts to corporation tax.

Lowcock says: ‘While this is great for company’s which already produce all their items at home, the main aim is to try and encourage manufacturers to relocate to the US and not operate out of Mexico. Relocating and building new factories, for example, will cost manufacturers though.’

BUY Shares in big US tech firms such as Apple and Alphabet (Google).

SELL Global Emerging Markets funds, the typical fund is down 12.4pc over the past year.