Disclosure – Non-substantive Research
This is not substantive investment research or a research recommendation, as it does not constitute substantive research or analysis. With this commentary, Kepler Partners LLP does not intend to influence your investment firm's behaviour.
There is no question the UK economy is in dire straits. A fall of 12% in GDP in Q2, followed by a 16% rise, led to an economy 7% smaller in September. The recent imposition of a second lockdown will lead to a further decline. The Bank of England forecasts the UK economy will end the year 11% smaller than when it started. The Office for Budget Responsibility estimates it will be smaller than it was entering the crisis until late 2022. With hopes of an effective vaccine, in recent weeks the UK has started to outperform, and discounts have drifted in for UK investment trust sectors. With a second wave of COVID-19 under way and Brexit on the horizon, investors may worry that it’s too soon to invest in the UK again. In this article we highlight the extreme valuation disparity between the UK and the rest of the world, discuss the outlook and highlight some trusts we think might do well if – or when – sentiment to the UK recovers from the lows of the past four and a half years.
Kepler Trust Intelligence provides research and information for professional and private investors. In order to ensure that we provide you with the right kind of content, and to ensure that the content we provide is compliant, you need to tell us what type of investor you are.Read the full article