UK small caps offer the most compelling valuations going forward as more stable economic conditions, cheap financing and increased availability create a positive outlook, according to Fidelity.
An improving economic climate combined with a pick-up in corporate expenditure and increasing M&A activity, will have a positive impact on the sector, said Fidelity UK Opportunities fund manager Alex Wright. "As we move into an environment of greater certainty this should be good for small caps which have historically performed well in times of positive economic momentum," he said. Whilst Wright predicts GDP growth is likely to remain relatively low for some time, he said smaller companies are set to benefit as the country moves into a more stable economic environment and corporate ex...
To continue reading this article...
Join Professional Adviser for free
- Unlimited access to real-time news, industry insights and market intelligence
- Stay ahead of the curve with spotlights on emerging trends and technologies
- Receive breaking news stories straight to your inbox in the daily newsletters
- Make smart business decisions with the latest developments in regulation, investing retirement and protection
- Members-only access to the editor’s weekly Friday commentary
- Be the first to hear about our events and awards programmes