How to tap into a slow economic recovery?
Despite notching up returns of more than 20%^, last year was anything but smooth sailing for global...
Following the election result overnight, Darius McDermott, managing director of FundCalibre, gives his take on what a Tory majority could mean for our investments.
“A majority government is exactly the result Boris Johnson was hoping for. He will now have more freedom to negotiate with the European Union, and a softer Brexit could be on the cards – but at least finally in sight.
“The UK stock market is likely to rally now, as will the pound, as confidence returns. Domestic-facing businesses and smaller companies in particular should do well.
“In contrast, the larger overseas earners in the FTSE 100 may suffer a little due to the currency reversal. However, this may be mitigated in time by overseas investors returning to our shores and once again investing more broadly in the UK stock market.
“There is a lot still to be done in terms of the final trade deal, but we at least now have a clearer path, and a sense of purpose, so British companies can operate with less of a cloud hanging over their futures.”
Managed by Alex Wright, this trust is a prime candidate for value investors looking to tap into the unloved UK market. A contrarian investor, Alex targets companies which are exceptionally undervalued as a way of preserving capital as well as those where he feels there is a catalyst for growth in earnings. These catalysts can take many forms, such as a change in economic conditions or a change in management.
This fund is run by two managers with an exceptional track record of investing in UK smaller companies. Paul Marriage and John Warren look for companies with a differentiated product, high margins, company management aligned with shareholders, and a market leading position. These companies will make up 75% of the portfolio, with the remainder allocated to value opportunities, like self-help stories.
This fund leverages off a wider team of some 50 investment professionals to take advantage of its private equity expertise to invest in some truly unexplored areas of the market. The fund invests in around 50 very small companies and manager Ken Wotton will hold successful investments as they grow in the future. Ken also avoids high-risk sectors such as oil, mining and property.