Invesco’s Barnett puts domestic-facing slant on portfolio

Added 31st October 2016

Invesco Perpetual’s head of UK equities Mark Barnett has out more of domestic-facing slant on his portfolio in light of the robust growth generated despite the uncertainty created by Brexit.

Invesco’s Barnett puts domestic-facing slant on portfolio

“Should GDP growth be maintained through the second half of 2016 I anticipate improved confidence in domestic-facing companies,” Barnett explained. “In view of this, the marginal reshaping of my portfolios has included a venture into the retail sector with the purchase of clothing business Next.”

“The political events of June made for a stormy summer in UK equity markets, but after a quieter August, I expect UK companies to be very much business as usual as the market goes back to work,” he continued. “The UK equity market has staged a remarkable recovery from its post-Brexit shocks; in aggregate, equity prices have risen strongly since the referendum, buoyed by the flight to perceived safety in defensive and international stocks, and by weakened sterling.”

As well as Next, Barnett also pointed to a handful of financials in his portfolio as examples of the domestic plays he is referring to.  

“UK financial stocks, including portfolio holdings Provident Financial, Legal & General and Derwent London, were also hit hard in the sell-off, but all three bounced back strongly in July and August. The scale of the decline in certain domestically-focused sectors, notably financials, construction and travel, was more severe than expected.”

“But the subsequent reversion in share prices of some of the hardest-hit companies, speaks volumes for the irrational pricing and unusual asset correlations at play in the current market environment,” Barnett continued. “By taking advantage of what I believe to be pricing anomalies in depressed areas of the market, alongside some profits from inflated dollar-earners, I have increased my portfolios’ domestic exposure.”

Barnett also noted that UK equity market valuations overall are currently trading at around 18 times 2016 earnings, which in his view is inflated. 

Kames Income Hub

home_research_centre

Vincent McEntegart, manager of the Kames Diversified Monthly Income Fund, explains how he aims to deliver a stable and sustainable income of 5% p.a.*, paid monthly, by investing in a range of asset classes

Square Mile Research

Premier Multi Asset Global Growth - Alex Farlow
Premier Multi Asset Global...

Talking Factsheets is a video service for users...

Visitor's Comments Add your comment

Add Your Comment

We won't publish your address

About Author

Alex Sebastian

News editor

Alex joined Portfolio Adviser in April 2014 and has been a financial journalist since 2008. He has previously held editorial positions at the Financial Times Group and Euromoney Institutional Investor. Alex is NCTJ qualified and has a degree in economics from the University of Sussex.

Profiles

Viewpoint

Investment Strategy

Feature

Tweets

Events

PA Dublin October 2017
PA Dublin October 2017

Tuesday 10 October
Westbury Hotel, Dublin

PA US 2017
PA US 2017

Tuesday 17 October
Furniture Makers' Hall

PA Channel Islands November 2017
PA Channel Islands November 2017

Tuesday 14 November
Royal Yacht Hotel, Jersey

PA Alternative Ucits November 2017
PA Alternative Ucits November 2017

Tuesday 7 November 
Furniture Makers' Hall

Sponsored Content

OTHER STORIES FROM LAST WORD...