14th Sep 2015 14:14
LONDON (Alliance News) - Invesco Perpetual UK Smaller Companies Investment Trust PLC on Monday said it performed better than its benchmark in the first half of its financial year.
The trust, which invests predominantly in smaller UK businesses that are publicly listed, said its net asset value total return was 14.3% in the six months to July 31.
In that period, the Numis Smaller Companies Index (ex Investment Companies), its benchmark, returned 12.9%.
"More recently, concerns over the prospects for the global economy, in particular the effect on the real economy of the slowing down of China's rate of growth and the uncertainty around a potential interest rate rise in the US, have resulted in an increase in market volatility," Chairman Ian Barby said in a statement.
"However, the UK environment appears more benign, with positive economic indicators present. The UK consumer has also benefited from a combination of rising wages and low inflation, leading to an increase in consumer spending," Barby added.
According to Barby, the manager of the trust's portfolio, Jonathan Brown, believes that equity valuations are still "attractive" relative to other assets, particularly bonds.
This, along with a "moderate improvement" in the prospects for the UK, US and Eurozone economies, bodes "reasonably well for UK smaller companies over the remainder of the financial year", according to the investment trust.
"Against this backdrop, your portfolio manager continues to take a longer-term investment approach, identifying opportunities to purchase high-quality growing businesses at good valuations, with a focus on fundamental analysis," Barby said.
Shares in the trust were down 0.1% at 378.80 pence on Monday afternoon.
By Samuel Agini; [email protected]; @samuelagini
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