Amid sluggish economic growth, Ken Rayner, director at Rayner Spencer Mills, asks whether smaller companies can really be a sensible investment decision.
The UK Smaller Companies sector is defined by the IMA as funds which invest at least 80% of their assets in UK equities of companies which form the bottom 10% by market capitalisation. Funds in the UK Smaller Companies sector can be a useful option for larger UK portfolios. Some of the largest returns can be sourced from this area of the market, but this brings with it higher levels of volatility. With this in mind, this is not an area of the market we regard as core to a UK portfolio. Many small companies now have significant international sales, so the sector is no longer just a pla...
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