by Kyle Caldwell from interactive investor, 11th January 2024:
There are various ways to improve the odds of investment success, including having a diversified portfolio, investing over the long term, and rebalancing a couple of times a year.
Another one is to keep a close eye on valuations and seek out undervalued areas of the market…
James Carthew, head of investment companies at QuotedData, says fund managers of UK equity funds are in agreement that UK equities look cheap relative to peers, particularly US stocks…
As well as picking out UK smaller companies trusts as one area that “looks attractive as they are on very decent discounts”, Davis is also attracted to renewable infrastructure trusts…
Carthew agrees that this sector stands out for bargain opportunities having been out of favour as interest rates rose. He says investors “could almost throw a dart at the sector and come up with a bargain”…
Carthew adds: “High yields, growing dividends that are often well-covered by cash earnings, and predictable revenues with inflation linkages all add up to an attractive cocktail. Solid, well-established funds on attractive yields/discounts include NextEnergy Solar, Foresight Solar, Bluefield Solar Income Fund, and JLEN Environmental Assets Group, offering discounts of -16.9%, -15.3%, -12.8% and -15.7%.
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