Three strong small caps going cheap

Amid turbulent times in the UK equity market, Chris Fontenla (left) of Scottish Widows Investment Partnership picks three small caps that have been left trading at attractive valuations.

Every week, a professional investor tells MoneyWeek where he'd put his money now. This week: Chris Fontenla, manager of the UK Smaller Companies fund, Scottish Widows Investment Partnership (SWIP)

These are turbulent times in the UK equity market. Investors are worried about the fallout from US subprime lending and signs that the British economy may have reached a turning point. However, the recent market correction has left a number of small caps trading at attractive valuations. Our rigorous, in-depth research process identifies firms that are well managed and able to sustain a competitive advantage in growth markets, and which generate strong free cash flows.

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