The Schroders UK mid-cap unit trust is overweight in technology, support services and media in the b...
The Schroders UK mid-cap unit trust is overweight in technology, support services and media in the belief that IT stocks will drive the Mid 250 in 2000, writes Leo Bland.
The Schroder UK Mid 250 fund was launched earlier this year and is run by Andy Brough and his investment team. Brough, who is head of the mid and small cap teams at Schroders, also runs the Schroder UK Smaller Companies fund for the group. Brough is taking the view that sectors including media stocks will benefit from the growth in the advertising spend by internet companies.
Brough said: "A sector that is likely to remain buoyant is media - especially advertising agencies. These are benefiting from the surge in spending by dot.com companies trying to build market share. Next year we could also see fresh interest in emerging pharmaceutical companies which have lately been out of favour but which still have the potential to deliver significant new products."
Brough favours pharmaceuticals stocks including BTG, Bioglan and Galen. BTG has seen its share price rise by 135.26% in the 12 months between 16 December 1998 and 16 December 1999. Media stocks which Brough favours include Aegis which has seen its shares rise by 126.72% in the 12 months to 16 December. He holds Capital Radio, whose shares are up 160.18% in the same time period. Brough also has a holding in computer services company Admiral, which has seen its share price rise by 37.86% in the 12 months to 16 December.
Schroders rejigged its UK equity investment process in 1998 and changed how it looks at FTSE 100 and FTSE 250 stocks. The investment house set up a team to look at the FTSE 100 and another headed by Brough looking at the mid-cap stocks in the FTSE 250. This replaced the previous system where Schroders had a team focusing on the top 50 stocks, one on the next 150 and another on the next 200 .
Schroder Smaller Companies unit trust has an frAAA rating and is ranked six out of 59 in its sector over five years on an offer to bid basis with net income reinvested.
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