Fund Profile

Disclaimer

Disclosure – Non-Independent Marketing Communication

This is a non-independent marketing communication commissioned by Miton UK MicroCap. The report has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibition on the dealing ahead of the dissemination of investment research.

Overview
A new version of this profile is available. View Latest
Overview

In our view, Miton UK MicroCap (LON:MINI) provides a genuine diversification opportunity for investors. As discussed in Portfolio, the focus is on UK small- and micro-cap equities including a significant allocation to AIM listed stocks that makes up 80% of the allocation. MINI is managed by Gervais Williams and Martin Turner who argue that micro caps – stocks with market capitalisations of less than £150m – offer investors a contrasting exposure to mainstream stocks. They are typically less mature, with more nimble management structures which may explain why they have substantially outperformed since 1955, when UK data was first comprehensively collected. Furthermore, they believe there is an abundance of opportunities in the sector to diversify stock-specific risk and add additional value given the near absence of professional investors analysing this investment universe.

As discussed in Performance, whilst UK-listed global majors have performed unusually well relatively to international peers over the last 18 months, domestic concerns have weighed heavily on UK-quoted micro-cap share prices. Gervais argues this is similar to the period prior to March 2020 when uncertainties of the Brexit negotiations and the global pandemic weighed on MINI’s aggregate performance. We note MINI has at times demonstrated exceptional performance and surprised on the upside, generating a NAV total return of 277% between March 2020 and May 2021. Gervais argues that less mature, quoted micro caps can sometimes sustain commercial momentum even during a global economic recession.

MINI’s shares tend to trade close to its NAV when compared to its peer group and offers all shareholders’ a voluntary redemption facility each year. Its current Discount is 8.9%, and its five-year average is 6.9%.

Analyst's View

Gervais and Martin have demonstrated an ability to deliver exciting returns when micro-cap conditions are favorable, outperforming most other trusts within the peer group. Given the unsettled market conditions currently, we are reassured that the managers place a special emphasis on premium customer service and relatively strong balance sheets since these factors have the potential to offset profit margin pressure, and insolvency risk. Furthermore, if a number of zombie companies and highly borrowed private companies become insolvent in the coming months, we believe this may boost market dispersion. This may provide an opportunity for companies with strong balance sheets and access to institutional capital to expand into the vacated markets and may include opportunities to acquire debt-free businesses for low entry valuations.

In the long run, we believe the concentration of holdings at the smaller end of the market-cap spectrum means MINI will naturally provide a less correlated returns profile that could complement a portfolio skewed to large caps. Over the last 18 months dispersion has narrowed considerably, which has impacted nearly all active strategies. However, this adverse factor appears to have been especially unhelpful for UK small caps, and most particularly micro caps including MINI.

Bull

  • Diversified portfolio offering a returns profile less correlated to core global equity strategies
  • Underlying holdings are attractively valued, and may present an opportunity should investor sentiment improve
  • Consistent investment strategy that has the potential to benefit from the asymmetric payoff associated with micro-cap investing

Bear

  • OCF of 1.75% is higher than some peers
  • Strict small and micro-cap mandate limits benefits of long-term compounding returns
  • Performance has lagged peers and the broader market
Continue to Portfolio

Fund History

14 Jun 2024 Three ‘chiers’ for Macron
Whatever the outcome of the French president's gamble, turgid politics in Europe have far-reaching implications for investors…
18 Jun 2024 Miton UK MicroCap
Gervais Williams
Join this webinar as part of our week-long June online series 'Small caps - a lost decade' hosted by the team at Kepler Trust Intelligence...
calendar Register now
29 May 2024 It’s a small world after all
A recent rally in smaller companies could be the start of a long-term recovery…
07 May 2024 Thomas McMahon speaks on the Money Makers podcast
Thomas McMahon, Head of Investment Companies Research, appears on the Money Makers podcast to discuss three current themes in the investment trust sector: BCPT and commercial property, ASIT and split-level trusts, and the UK micro-cap sector...
10 Apr 2024 Micro-managing
What opportunities exist in the smallest part of the UK market?
16 Feb 2024 Fund Analysis
MINI’s managers believe the prospects for the strategy are the best they have been for 30 years…
14 Dec 2023 Results analysis: Miton UK MicroCap
MINI’s managers argue there is option-like upside in their micro-cap portfolio…
01 Nov 2023 Back to basics
Higher rates mean re-visiting portfolio construction...
24 Aug 2023 Fund Analysis
MINI’s managers aim to exploit extreme value in UK micro-caps…
11 Jul 2023 Results analysis: Miton UK MicroCap
MINI’s portfolio of micro-caps is trading on deeply discounted valuations…
06 Apr 2023 Fund Analysis
MINI’s portfolio is unusually cheap…
15 Dec 2022 Results analysis: Miton UK MicroCap
MINI’s unique investment process may uncover some good value in an otherwise uncertain environment…
16 Nov 2022 Bottom fishing
What can history tell investors about calling the bottom of a market?
11 Nov 2022 Called it
Some managers predicted we’d end up with the chaos we have today – but will they still perform well?
28 Sep 2022 Mind the gap
While chaos reigns in the short-term for markets, some investors see a growing disconnect between prices and reality...
28 Sep 2022 Slides and Audio: Miton UK MicroCap
Download the presentation and listen to the audio from our 'Growth at an unreasonable price' event from 23 September...
15 Sep 2022 Fund Analysis
MINI’s share price discount could offer a long-term entry opportunity…
31 Aug 2022 Growth at an unreasonable price
Growth has taken a beating as inflation fears have soared, but the tide may be turning and we have six speakers at our next event ready to tell us why…
10 Aug 2022 Get ‘em while they’re hot
Wide discounts in the UK Smaller Companies sector may present long term investors with good entry opportunities…
20 Jul 2022 Results analysis: Miton UK MicroCap
MINI’s share price discount could offer a good long-term entry opportunity…
17 May 2022 Podcast: How small caps will benefit from deglobalisation
Kepler's David Kimberley meets small cap veteran Gervais Williams for our first ever podcast...
16 Feb 2022 Perfectly formed
Our research suggests that investment trusts really are a better way to gain exposure to smaller companies…
30 Dec 2021 Great expectations
As the last of the mince pies wilts in the fridge, topped with a generous helping of stilton, the Kepler Trust Intelligence team stick a finger in the air and point toward their top picks for the year ahead…
30 Dec 2021 Fund Analysis
Specialising in the very smallest UK listed companies, MINI can provide a differentiated source of growth…
03 Nov 2021 Don't fear the reaper
With market direction hard to call, we consider the case for taking a long-term view in the investment trust sector…
29 Sep 2021 Slings and arrows
Our analysts argue over whether it’s better to take arms against volatility in a portfolio, or to simply suffer it…
11 Aug 2021 In at the deep end
Does seeking out wider-than-usual discounts help investors systematically outperform in the UK trust space?
30 Jun 2021 Inflation – a real threat or hot air?
Two of our analysts ask whether recent high inflation numbers indicate something long-lasting and troubling is happening…
05 May 2021 Vive la revolution
For thirty years quality has had a structural tailwind; but revolt is in the air and value is on the barricades…
07 Apr 2021 Fund Analysis
After an exceptional 2020, MINI may yet have further to go…
24 Mar 2021 Shoot to Thrill: ISA targets for long term growth
We all intend to invest for the long-term but can often be distracted by the news...
10 Feb 2021 Eye of the Pfizer
Mining shares have rallied in recent months. With further potential, what impact could this have on the relative returns of active UK Small cap strategies...
14 Oct 2020 Fund Analysis
MINI is the strongest performing UK Smaller companies trust in 2020…
06 May 2020 The fight in the dog
We look at the characteristics which have separated the winners from the losers among small-cap trusts in the current crisis, with some surprising results...
30 Apr 2020 Talking Trusts - Gervais Williams, Miton UK MicroCap
Earlier this month, we hosted a webinar and live Q&A with Gervais Williams - watch the video and hear the audio here...
16 Apr 2020 Sea-change
Join smaller companies specialist Gervais Williams for a live Q&A to find out why, in the face of collapsing markets, small caps are in a uniquely strong position to perform...
02 Oct 2019 Fund Analysis
Based around a clear macroeconomic view, MINI offers investors exposure to some of the most exciting opportunities within the UK…
11 Sep 2019 Nanny knows best: how regulation is influencing returns
New research suggests disruption is threatened by increased regulation, with clear consequences for investment strategists...
04 Jul 2019 An industry icon
Stalwart of the investment trust sector Gervais Williams explains how a three decade history with trusts has informed his thinking...
19 Feb 2019 Fund Analysis
Launched in 2015 in anticipation of a post-globalisation pushback, Miton UK MicroCap invests in the smallest UK listed companies...
05 Nov 2018 Do politics matter?
With the pivotal US mid-terms looming, politics are front of mind for many investors - but should they be?
12 Sep 2018 Fake news...
Small cap funds, despite their reputation to the contrary, are less volatile and have delivered better risk adjusted returns than their large cap peers...
11 Sep 2018 Fund Analysis
Run by Gervais Williams and Martin Turner, Miton UK Micro Cap is a £102m investment trust that invests in the smallest companies in the UK...
19 Jun 2018 Pretty little things
Many smaller companies managers have been shifting into micro caps in 2018, should investors be following suit?
25 Oct 2017 Patience is a virtue…
We analyse the outperformance of UK small-caps and why it has been so important to take a long-term view...
13 Sep 2017 Big Issue(rs)
We highlight the UK equity trusts that have issued and bought back the most shares over the course of 2017 so far and how these actions have affected shareholders...
12 Sep 2017 Fund Analysis
A UK equity trust run by a highly-experienced team that invests in stocks with market capitalisations of less than £150m...
View all

Welcome to Kepler Trust Intelligence

Please enter a valid email address
{{item.msg}}
Please enter a valid password
{{item.msg}}
Please enter a valid email address
{{item.msg}}
Please check your email. If an account exists you'll be sent instructions on how to reset your password.
To ensure that we are able to provide content which is appropriate for you, please tell us a little about yourself.
Please choose an option
{{item.msg}}
Please enter a company name
{{item.msg}}
Please enter a location name
{{item.msg}}
Please choose an option
{{item.msg}}
Please enter a platform
{{item.msg}}
Please choose an option
{{item.msg}}
Please enter a trust
{{item.msg}}
?
The information contained herein is not for distribution and does not constitute an offer to sell or the solicitation of any offer to buy any securities in the United States to or for the benefit of any United States person (being residents of the United States or partnerships or corporations organised under the laws thereof). The investment funds referred to herein have not been registered in the United States under the Investment Company Act of 1940 and units or shares of such funds are not registered in the United States under the Securities Act of 1933.
Please confirm
{{item.msg}}
Please select an option
{{item.msg}}
See benefits
A free Kepler Trust Intelligence account allows you to access premium content including the ‘Kepler View’ – our verdict on the trusts we cover – and historical research so you can see how our view has changed over time. An account also unlocks useful facilities like the ‘follow’ button which lets you keep track of the trusts you’re interested in and as a logged in user you can also download PDFs of our research, and choose the layout of the page you’re reading to suit your preference. We will not share your details unless you give us permission to do so, and we won’t bombard you with emails – we only send one a week.
Please select an option
{{item.msg}}
Please enter your first name
{{item.msg}}
Please enter your last name
{{item.msg}}
Please enter a valid email address
An account already exists with this email - have you forgotten your password?
{{item.msg}}
Please enter a valid password
{{item.msg}}
Please enter a valid password
{{item.msg}}
How will this information be used? Your answers help us to tailor our content to relevant investment trusts, and to ensure that the asset allocation and portfolio strategy research we produce is appropriate to our userbase.
Our Website uses Cookies Cookies are small text files held on your computer. They allow us to give you the best browsing experience possible and mean we can understand how you use our site. Some cookies have already been set. You can delete and block cookies, but parts of our site won’t work without them. By using our website you accept our use of cookies. For further information please refer to the Kepler Privacy Notice.
Need help?

One more thing...

Did you know, you can 'follow' individual trusts on Kepler Trust Intelligence? Use the functions below to set up alerts and we'll send you research and updates on your chosen trusts.

Suggested trusts to follow

Browse all funds
Need help?
Current Site Kepler Trust Intelligence is produced by the investment companies team at Kepler Partners and is the UK’s premier source of detailed qualitative research on investment trusts. Absolute Hedge is a market leading UCITS research database providing proprietary research on funds, themes and strategies in the UCITS space. Kepler Liquid Strategies is a Dublin domiciled UCITS fund platform featuring a number of best-of-breed fund managers. Kepler Partners is a corporate advisory and asset raising boutique specialising in the regulated funds market in Europe and investment trusts in the UK.