A fledgling small-cap fund takes flight

Launching a new fund at a relatively unknown fund manager? How do you make a splash? What about returning over 70% in the first 14 months? It might sound unlikely, but that’s just what Miton has achieved with its CF Miton UK Smaller Companies fund.

While you may not have heard of the Reading-based firm, chances are you know of the fund’s manager Gervais Williams. Formerly of Gartmore, Williams has a solid reputation as a small-cap stock-picker. In fact, says Jeff Prestridge in The Mail on Sunday, Williams, who meets up to seven companies a day, has made “hunting down under-appreciated British smaller firms a personal passion”.

While the fund is in its infancy, accordingto Trustnet.com it has delivered 59.5% over one year, compared to the 32.2% returned by its benchmark IMA UK Smaller Companies index, and 74% since launch.

CF Miton Smaller Companies fund performanceThe question, says Prestridge, is whether the fund, which has an initial charge of 1.5%, can sustain this. After all, UK smaller companies put in a particularly strong performance in 2013. Williams, who thinks the fact that many Aim stocks are poorly researched means there are rich pickings for those prepared to do some legwork, thinks “we’re at an early stage of a multi-year period of small company outperformance”.

According to Miton, around 80% of the fund is in Aim stocks, while 9.6% is in FTSE small-cap shares, 2% in the FTSE 250 and around 4% in cash. The fund should suit investors looking for greater exposure to UK small caps.

Contact: 0118-952 8900.

CF Miton Smaller Companies top ten holdings
Name of holding % of assets
SQS Software Quality Systems 3.97%
Seeing Machines 3.55%
Conygar Investment Co 3.22%
Plus500 3.18%
Quindell 2.91%
Dialight 2.90%
Michelmersh Brick Holdings 2.76%
McColls Retail Group 2.51%
International Greetings 2.45%
Gable Holdings 2.31%

 

Merryn

Claim 12 issues of MoneyWeek (plus much more) for just £12!

Let MoneyWeek show you how to profit, whatever the outcome of the upcoming general election.

Start your no-obligation trial today and get up to speed on:

  • The latest shifts in the economy…
  • The ongoing Brexit negotiations…
  • The new tax rules…
  • Trump’s protectionist policies…

Plus lots more.

We’ll show you what it all means for your money.

Plus, the moment you begin your trial, we’ll rush you over THREE free investment reports:

‘How to escape the most hated tax in Britain’: Inheritance tax hits many unsuspecting families. Our report tells how to pass on up to £2m of your money to your family without the taxman getting a look in.

‘How to profit from a Trump presidency’: The election of Donald Trump was a watershed moment for the US economy. This report details the sectors our analysts think will boom from Trump’s premiership, and gives specific investments you can buy to profit.

‘Best shares to watch in 2017’: Includes the transcript from our roundtable panel of investment professionals – and 12 tips they’re currently tipping. The report also analyses key assets, including property, oil and the countries whose stock markets currently offer the most value.