Small caps
This is more than twice the 16.4 percentage point figure for the smallcap sector with the next largest difference , IA UK Smaller Companies . As a relatively unpopular sector – IA European Smaller Companies has just £ 2.3bn in assets , spread across 28 funds – it has made sense to close or merge underperformers . Regardless of what has happened before , Kosava believes it will be important to be selective in the environment we are entering now . “ With central banks increasing interest rates in the wake of persistent inflation , recessionary pressures on consumers and individual smaller companies being more susceptible to bankruptcy than their larger counterparts , it pays to employ an active manager in this area ,” she says .
Performance of sector vs index over 10yrs
MSCI Europe Small Cap ( 180.5 %)
IA European Smaller Companies ( 161.6 %)
300 % |
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250 % |
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200 % |
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150 % |
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100 % |
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50 % |
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0 % |
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-50 %
Sep12
|
Sep13 |
Sep14 |
Sep15 |
Sep16 |
Sep17 |
Sep18 |
Sep19 |
Sep20 |
Sep21 |
Source : FE Analytics
Issue 87 - September 2022 / 41 /