It’s no secret that UK equities have been unloved in recent years. But we believe that UK stocks deserve a place in a well-diversified portfolio, and that the current environment is supportive of unlocking the potential in UK equities. The economy has healthy underlying fundamentals as it moves on a path of disinflation, with steady yet muted growth and healthy consumer and corporate balance sheets. The July election delivered a decisive result for the new government that we anticipate will provide stability and give companies confidence to invest in their futures. Central banks including the Bank of England are seeking to bring down interest rates as inflation eases, and UK equities tend to respond positively to inflation trending lower.

 

The UK market is cheap versus history and versus other markets including the US, and this provides ample potential for stock pickers to generate returns. By cheap, we mean that the valuation stock benchmarks is low. It’s not just about valuation, however. UK plc can offer compelling investment opportunities across a range of industries and market sectors from consumer goods to technology to financial services, serving domestic UK as well as international markets, including global leader large cap companies and fast-growing small- and mid-cap firms.

 

We see the robust pace of corporate activity, including mergers and acquisitions (M&A), as a sign of market dynamism and of the underlying attractiveness of UK plc. Private equity and overseas businesses are buying UK companies at price premiums (or a price higher than the share price) that highlight both the quality of the target businesses and their lagging valuations. UK companies are buying back their own shares at a brisk pace, indicating balance sheet strength and a desire to boost valuations.

 

UK equities are a core part of our business at Jupiter. We offer a broad and deep range of actively managed, high-conviction UK equity funds overseen by experienced portfolio managers. At Jupiter we maintain a relentless focus on generating strong, sustainable, long-term returns for clients, and an investment culture that promotes accountability, independent thought and the autonomy of our fund managers. The selection of funds highlighted here offer solutions across the market cap (market value) spectrum for investors seeking growth stocks, value stocks, income growth, and uncorrelated long-short return streams. Capital at risk.

A range of UK equity solutions

1. Looking for income across the market cap spectrum

2. Looking for returns from undervalued companies

3. Looking for returns across the mid cap range

4. Looking for returns from high-quality, faster growing companies

5. Looking for uncorrelated returns in a long/short strategy

The value of active minds – independent thinking

A key feature of Jupiter’s investment approach is that we eschew the adoption of a house view, instead preferring to allow our specialist fund managers to formulate their own opinions on their asset class. As a result, it should be noted that any views expressed – including on matters relating to environmental, social and governance considerations – are those of the author(s), and may differ from views held by other Jupiter investment professionals.

Important Information

Market and exchange rate movements can cause the value of an investment to fall as well as rise, and you may get back less than originally invested.  Past performance is not a guide to future performance. Company/Holding/Stock examples are for illustrative purposes only and are not a recommendation to buy or sell. Quoted yields are not a guide or guarantee for the expected level of distributions to be received. The yield may fluctuate significantly during times of extreme market and economic volatility. Awards and Ratings should not be taken as a recommendation. Every effort is made to ensure the accuracy of the information provided but no assurance or warranties are given. This communication is for informational purposes only and is not investment advice. We recommend you discuss any investment decisions with a financial adviser, particularly if you are unsure whether an investment is suitable. Jupiter is unable to provide investment advice. An investor should read the Key Investor Information Document (KIID) before investing in the Fund. The KIID and the Prospectus are available for download from www.jupiteram.com.