Neil Woodford, manager of the Omnis Income & Growth Fund, gives his views on the prospects for the fund and the UK equities market, some parts of which he believes are in ‘bubble’ territory.
Neil met with Omnis’ Gary Shepherd to reflect on the risks and opportunities that appear at times, such as now, when he believes some share prices can become “detached from reality”.
He outlines his belief that the UK stock market has become very narrow in its focus, with the stocks that have been leading the rally tending to be some of the largest and most-followed names in the country.
However, Neil is more excited about some smaller companies, on cheaper valuations, which he believes international investors are ignoring. It is these kinds of companies, at around less than £1.5bn in market capitalisation, that make up around half of the Omnis Income & Growth Fund (as at end 2017).
The founder of Woodford Investment Management stressed that his process remains consistent, with “anchor points” built on valuation, a long-term outlook, and focus on the fundamentals of businesses and the economies in which they operate.
Looking ahead for 2018, he believes Omnis investors can benefit from an “inflection point” to come when markets will reappraise value and focus more on business fundamentals.
Watch the full interview below: