By ROSIE MURRAY-WEST, Mail on Sunday, 30 July 2023:
Investors in British companies have had a tough time this year.
They have endured a rollercoaster ride of stomach-lurching rises and falls if they invested in the FTSE 100 list of the UK’s 100 largest companies – and all they would have to show for it is a return of just 1.93 per cent.
If they had invested in the 350 largest UK companies, they would have fared no better.
Investors who have snubbed the UK for some time may be looking to wade back in…
The outlook may be brightening, but the negativity that is still pervasive means the UK stock market could be significantly undervalued. Therefore there may be some bargains to be had by investors who know where to look.
There are three ways that investors can make money from UK companies that are looking cheap…
One is by buying shares that seem underpriced and hoping they increase in value as sentiment improves.
Another is by investing in cheap companies that still pay out strong dividends as income…
Third, venture capitalists and other private investors from around the world have been sniffing around Britain’s relatively cheap companies for some time…
Picking the companies that show potential is tough, even for experts. Most investors prefer to invest through a fund, where an expert manager picks a selection of companies on your behalf…
James Carthew, at investment trust business QuotedData, suggests Baillie Gifford UK Growth, a smaller fund on a 14 per cent discount. This fund holds everything from Auto Trader to Games Workshop. The fund yields 2.2 per cent, is up 10 per cent over 12 months but down 5.7 per cent over six.
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