Small and mid-cap market sentiment "beginning to change" - Downing Fund Manager
London, UK
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August 21, 2023 03:34 AM Eastern Daylight Time
VT Downing Small & Mid-Cap Income Fund Manager Josh McCathie visits the Proactive Londons studio to speak with Thomas Warner about the outlook for the UK's small and mid-cap companies.
McCathie gives a quick overview of the fund, highlighting its quality-value approach that seeks out businesses capable of compounding earnings and dividends over time. Despite recent market challenges, he notes a shift in sentiment as UK small and mid-caps gain attention due to their appealing valuations.
He cites some evidence from a recent fund manager survey from the Bank of America that the UK is now looking increasingly attractive, "given the value that's on offer." McCathie draws attention to the importance for investors of factoring in the returns coming from dividends, which he suggests can make up to 80-90% of the total.
He also dispels the misconception that the UK's small and mid-cap sector is overwhelmingly UK-centric, explaining that a significant portion of London-listed companies have diversified revenue streams and significant exposure to markets overseas.
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