60 seconds with Andy Brough on UK mid-caps' enduring appeal
Earnings and dividend growth, combined with the high level of takeover activity, mean UK mid-caps have not lost their appeal after the Brexit vote, says Andy Brough.
Recent months have led some investors to question whether UK mid-caps are still an attractive place to invest.
We’ve seen disappointment connected to domestically-focused UK companies as investors fled that part of the market after the Brexit vote.
Some people believe large companies are safer and so they’re taking their investment away from mid-cap stocks to move into the larger-cap area of the market.
But, you invest in equities to participate in a rising stream of dividends from a rising stream of earnings and, if you look over the course of history, that is where the mid-cap area of the market has excelled.
We passionately believe that mid-caps remain attractive. Not only from an earnings and dividend growth perspective, but also – more importantly – because we see far more takeovers in this area of the market and over time that’s really driven value in mid-caps.
The views and opinions contained herein are those of Schroders’ investment teams and/or Economics Group, and do not necessarily represent Schroder Investment Management North America Inc.’s house views. These views are subject to change. This information is intended to be for information purposes only and it is not intended as promotional material in any respect.