The struggling fund group Liontrust Asset Management expects a “change in investor sentiment” as banks cut interest rates and there is “political and fiscal certainty” in the UK.
CEO John Ions says: “There is no doubt that the level of investment by private individuals has been negatively impacted by the cost of living, the reduction in Covid savings and tax increases. With more stability, valuation opportunities will be more widely recognised, particularly in the UK equity market.”
If investors agree with him and invest in London stocks, it would boost the stock market and improve sentiment in the overall economy.
The fund manager suffered a loss of £0.6 million in the year to March, with funds under management falling 11% to £27.8 billion.
Like much of the stock-picking industry, Liontrust has seen many of its funds underperform recently, with many investors now opting instead for simple index funds, which are cheaper.
Ions added: “Negative investor sentiment over the past 18 months has combined with a market environment that has proven to be a significant headwind for many of our strategies, resulting in net outflows of £6.1 billion for Liontrust over the full financial year. This market environment has also led many commentators to once again question the value of active asset management.”
It managed to keep the dividend at 72 pence, suggesting that it might be better to buy the shares rather than the funds.
The share price fell 27 pence to 723 pence today.
