MARIANNA HUNT MILLENNIAL INVESTOR

Economists are warning of a recession – what can I add to my portfolio that will protect me from a stock market fall? 2007 We face the highest risk of recession since the credit crisis 12 years ago, warns the Resolution Foundation

I won’t be complaining if house prices crash – but investments are a different matter 117% The return on money invested in British stocks days before the collapse of Lehman Brothers

Finding a tenner on the street is a nice surprise that is quickly forgotten, but losing £10 leaves a bitter taste that sticks with you much longer. The same is true of investments.

Luckily, the four funds I’ve invested in since January are up by about 6pc so I haven’t had that feeling of loss yet, but it looks like I might be in for a rollercoaster ride.

The London stock market took a pummelling recently and was hit by its biggest fall in one day since the Brexit referendum, following whispers from economists of “recession”. These are now turning into shouts and the Resolution Foundation think tank has warned that we now face the highest risk of entering an economic slump since 2007.

What would that mean for my mission to use the stock market to fast-track my way on to the property ladder and turn my £10,000 inheritance into a deposit on my first home?

Well, I certainly won’t be complaining if house prices come crashing down, but seeing my investments plummet would be painful. If, for example, the £7,000 or so I have invested so far dropped in value by 50pc to £3,500, I’d have to double my money again just to get back to where I was. But the possibility of a downturn doesn’t mean I should back out of investing entirely.

Although the British stock market tumbled by almost 30pc in 2008 during the crash, analysis by Fidelity, an investment manager, found this wasn’t the case everywhere.

Its Japanese counterpart fell by barely 2pc while the value of global government bonds shot up by more than 50pc. This just goes to show that, even in a general slump, not all sectors and markets will crash.

So what do we buy in hard times? One thing that we all need, come recession or not, is healthcare.

Population growth is exploding and we’re living longer, so companies that create drugs and medical technologies are going be more vital than ever.

This is why I’ve chosen to invest £600 in Worldwide Healthcare, an investment trust that seeks out the best pharmaceutical and biotechnology companies around the world. It manages more than £1.4bn of investors’ money, funnelling it into innovative firms such as Novo Nordisk, a Danish company that is pioneering new drugs to tackle diabetes and other chronic illnesses.

The trust had a rocky 2018 but, according to Dr Trevor Polischuk, one of its two managers, the team is now taking a new approach and moving away from investing in larger pharmaceutical companies in favour of emerging biotech firms that have more potential to grow.

I did consider a few other healthcare options, including JP Morgan’s Global Healthcare fund and the Polar Capital Healthcare Blue Chip fund. These two have performed well over the past few years, but what I like about Worldwide Healthcare is its longevity.

It was set up in the year I was born (we’ll both be celebrating 25th birthdays in 2020) and over the past decade has made returns of 383pc. That means that if I’d invested the £10,000 I inherited from my granny in Worldwide Healthcare 10 years ago, and reinvested any dividends it paid me, I’d now have £48,290 – more than hitting my target of £40,000 for a house deposit (10pc of the value of the average London home).

I will also benefit from lower fees with Worldwide Healthcare. It takes 0.9pc of my investment each year, while the JP Morgan and Polar Capital funds both charge more than 1pc. Part of that 0.9pc is a performance fee that I pay if the fund does well; if it doesn’t, I’ll be charged less.

Even better, because it is an investment trust rather than a conventional fund, the price you buy at can vary according to how much other investors are willing to pay. I managed to buy at a slight discount: that is, I paid a lower price for my stake in the trust than its shares were actually worth.

I also intend to add more money to the trust in gradual instalments as part of my wider investment plan. By drip-feeding my £10,000 (plus £200 of extra monthly savings) into investments, I believe I can smooth out any sharp rises or falls in global stock markets and ride out the rollercoaster.

After all, it’s a rollercoaster that, by and large, has been going up. Even if you had invested in the London stock market on Sept 10 2008, a couple of days before the Lehman Brothers investment bank collapsed – widely considered to mark the beginning of the financial crisis – you’d still have seen your money grow by about 117pc by now.

Companies creating drugs and medical technologies will be more vital than ever

What do you think? Should I be more concerned about a potential recession? Let me know your thoughts by emailing marianna. hunt@telegraph.co.uk