PA Portfolio: Are smaller companies set for a pullback?

David Hambidge, head of multi-asset, Premier Asset Management We are at the five-year anniversary of the start of the equity bull market. Over that time, the FTSE Small Cap index is up nearly 250%, while the FTSE 100 is up 110%. Neither return is to be sniffed at but one is obviously much higher. Of course, small-caps got a complete pasting in the credit crunch, so part of this recovery has come because they were rising from a very low base. However, from a valuations perspective, we think they have gone beyond fair value. While recent data from the IMA shows inflows into smaller co...