An active UK equity fund, capturing opportunities in undervalued areas of the market.
The value offered by the UK market creates a real and present opportunity for long-term investors. This fund focuses on valuation at the point of purchase and recognises that many of the best ideas are non-consensus.
The UK market offers high quality, cash-generative businesses – many of which are global leaders in their own field. We believe that many of these are trading at attractive valuations.
Our assessment of opportunity focuses on a company’s valuation. Every stock has to have a compelling valuation case before being included in the portfolio. We look at valuation through four lenses:
The next decade is going to look quite different to the one we have just lived through. On average, we believe it will be characterised by higher inflation and a higher cost of capital. There will be periods of volatility. However, historically, these sorts of environments have favoured ‘value’ over ‘growth’.
The UK equity market is more ‘value’ oriented than its international peers. The active positioning of the fund accentuates this value bias.
Launched in the late 1980s, the fund has a long track record and has navigated a broad range of market environments. It has been consistently managed by Martin Walker since 2008 as a large cap, scalable, core value fund. Martin is a first-rate investor with 26 years of industry experience. Bethany Shard was appointed Deputy Manager of the fund in April 2023. Bethany is a Chartered Accountant with 9 years of industry experience. They are supported by a team of 7 other investment professionals.
This is a ‘best ideas’ portfolio of around 35-45 stocks. It is not constrained by a benchmark and invests only in those opportunities that look most compelling.
.svg)
We seek out companies that are trading at attractive valuations. This is fundamental to our assessment of opportunity at every stage of the process.
Our UK equity professionals carry out around 400 company meetings per year. They actively exercise their voting rights and voted 100% of eligible ballots in 2022.
Click below to visit the product page, where you can see how the fund has performed over time. You’ll also find factsheets and performance commentary there.
The UK Equities team forms part of the Henley based investment teams. It has a rich heritage spanning over four decades and continues to be a leading investor in UK publicly listed companies. Martin Walker has been a member of the team since 1999. He has been Head of UK Equities since 2020.
Click below to learn more and to discover additional UK equity products.
Markets were relatively volatile during the quarter, with investors being pulled between the negatives of geopolitics and weaker industrial demand, and the potential benefit of lower interest rates.
Better inflation data prompted a strong start to the quarter, however, there was a sharp sell-off in August as positivity around interest rates was swamped by fears of a US recession. These fears gradually dissipated, and markets largely recovered by the end of the quarter.
In this video, fund manager Martin Walker discusses what has been happening in UK markets, economic news and recent fund performance, plus his outlook for UK equities.
The UK market offers access to a wide range of world class, cash-generative businesses. Furthermore, UK equities are currently undervalued as an asset class, both relative to their own history and relative to international peers. They have endured headwinds for a number of years, firstly with Brexit, then the pandemic, and more recently from risk aversion across Europe as a result of war in Ukraine. The FTSE All-share index offers low correlation to US markets, but still has scale, breadth, and depth of companies. It offers something that is as different as it is attractive. And both these qualities are important.
The UK market derives about 25% of its revenues from the UK economy. In other words, it is a highly international equity market. This means that it is not as exposed to local economic headwinds as some other markets.
Furthermore, by virtue of the translation effect, weakness in sterling (especially relative to the US dollar and the euro) can offer a boost to UK equity market earnings. Bad news for the UK economy and sterling can be good news for UK equities, especially those that export goods and services or have substantial overseas operations.
ESG* is fully integrated into all stages of our investment process. We recognise the importance of ESG factors as a source of opportunity for companies, as well as a potential source of risk. Furthermore, we believe in the importance of engagement and dialogue in bringing about positive change and generating better investment outcomes
View Invesco’s full range of UK equity products, including our actively managed mutual funds and exchange traded funds (ETFs). Details on how to invest with us can be found here. Alternatively, complete the below form to let us know how we can help.
Let us know using this form and one of our specialist team will quickly get back to you.
* Whilst the fund manager considers ESG aspects, he is not bound by any specific ESG criteria and has the flexibility to invest across the ESG spectrum from best to worst in class.
The value of investments and any income will fluctuate (this may partly be the result of exchange rate fluctuations) and investors may not get back the full amount invested.
As the fund typically has a concentrated number of holdings, it may carry a higher degree of risk than a fund which invests in a broader range of holdings or takes smaller positions in a relatively large number of holdings.
The fund may use derivatives (complex instruments) in an attempt to reduce the overall risk of its investments, reduce the costs of investing and/or generate additional capital or income, although this may not be achieved. The use of such complex instruments may result in greater fluctuations of the value of the fund. The manager, however, will ensure that the use of derivatives within the fund does not materially alter the overall risk profile of the fund.
This marketing communication is for Professional Clients only and is not for consumer use.
Data is as at 31/10/2023 and sourced from Invesco unless otherwise stated.
This is marketing material and not financial advice. It is not intended as a recommendation to buy or sell any particular asset class, security or strategy. Regulatory requirements that require impartiality of investment/investment strategy recommendations are therefore not applicable nor are any prohibitions to trade before publication.
Views and opinions are based on current market conditions and are subject to change.
For the most up to date information on our funds, please refer to the relevant fund and share class-specific Key Investor Information Documents, the Supplementary Information Document, the financial reports and the Prospectus, which are available using the contact details shown.
Issued by Invesco Fund Managers Limited, Perpetual Park, Perpetual Park Drive, Henley-on-Thames, Oxfordshire RG9 1HH, UK. Authorised and regulated by the Financial Conduct Authority.
EMEA3217700/2023
