Fund Research

Miton UK Micro Cap

Last update 11 September 2018

Miton UK Micro Cap is a £102m investment trust which seeks to offer investors a domestically focused and largely differentiated trust, through investing in the smallest companies in the UK.

The managers believe that, a result of the financial crisis, poor productivity and stagnant wage growth has created an environment which is ripe for political upheaval.

Managers Gervais Williams and Martin Turner think a backlash against globalisation has been a key factor behind the political and economic changes that we have only just started to see happening. Added to this, the bull market we have enjoyed over the past decade caused by the response to the financial crisis, has caused a massive misallocation of capital due to the prolonged period of low interest rates and easily available credit. In their view, the clear beneficiaries of the anticipated changes to political and economic environments, will be better conditions for their small, domestically focused companies.

The portfolio is well diversified, with stock specific risk also spread via a wide range of relatively small holdings, currently 119. Of this, the top 10 holdings equate to 28% of the portfolio.

Since inception the company has performed well, returning close to 45% for investors. Although c.4% ahead of the Numis SC 1000 (Inc. Investment Companies) sector, the trust has trailed the benchmark FTSE AIM All Share by c.8%. It is worth bearing in mind that much of the outperformance of the benchmark has been dominated by a few names. Over the same time, the share price rating has varied greatly. For the first year after launch, the company traded on a significant premium. However, the referendum in 2016 saw the trust go from a c.10% premium to a c.8% discount in a matter of months. The trust’s discount has remained largely the same over the past 6 months and has traded on an average discount of -4.33% over the past year.

The managers often refer to the trust as an 'early stage income fund', as many of the holdings are early stage companies which they hope will increase their levels of cashflow, and in turn dividends, as they improve their productivity. However, at this moment in time the current yield is just 0.5%, relative to the sector AIC Smaller Companies average of 2.0%.

Kepler Trust Intelligence provides research and information for professional and private investors. In order to ensure that we provide you with the right kind of content, and to ensure that the content we provide is compliant, you need to tell us what type of investor you are.

Read the full article

More Research

Welcome to Kepler Trust Intelligence

Kepler Trust Intelligence is authorised in the UK by the Financial Conduct Authority.
Please enter a valid email address
{{item.msg}}
Please enter a valid password
{{item.msg}}
Please enter a valid email address
{{item.msg}}
Please check your email. If an account exists you'll be sent instructions on how to reset your password.
Kepler Trust Intelligence is authorised in the UK by the Financial Conduct Authority. To ensure that we are able to provide content which is appropriate for you, please tell us a little about yourself.
Please choose an option
{{item.msg}}
Please enter a company name
{{item.msg}}
Please enter a location name
{{item.msg}}
Please choose an option
{{item.msg}}
Please enter a platform
{{item.msg}}
Please choose an option
{{item.msg}}
Please select a range
{{item.msg}}
Please enter a trust
{{item.msg}}
View an example
Please select an option
{{item.msg}}
See benefits
A free Kepler Trust Intelligence account allows you to access premium content including the ‘Kepler View’ – our verdict on the trusts we cover – and historical research so you can see how our view has changed over time. An account also unlocks useful facilities like the ‘follow’ button which lets you keep track of the trusts you’re interested in and as a logged in user you can also download PDFs of our research, and choose the layout of the page you’re reading to suit your preference. We will not share your details unless you give us permission to do so, and we won’t bombard you with emails – we only send one a week.
Please select an option
{{item.msg}}
Please enter your first name
{{item.msg}}
Please enter your last name
{{item.msg}}
Please enter a valid email address
An account already exists with this email - have you forgotten your password?
{{item.msg}}
Please enter a valid password
{{item.msg}}
Please enter a valid password
{{item.msg}}
Your answers help us to tailor our content to relevant investment trusts, and to ensure that the asset allocation and portfolio strategy research we produce is appropriate to our userbase. We do not share your personal information and your answers are not linked to your identity for marketing purposes.

One more thing...

Did you know, you can 'follow' individual trusts on Kepler Trust Intelligence? Use the functions below to set up alerts and we'll send you research and updates on your chosen trusts.

Suggested trusts to follow

Browse all funds
Current Site Kepler Trust Intelligence is produced by the investment companies team at Kepler Partners and is the UK’s premier source of detailed qualitative research on investment trusts. Absolute Hedge is a market leading UCITS research database providing proprietary research on funds, themes and strategies in the UCITS space. Kepler Liquid Strategies is a Dublin domiciled UCITS fund platform featuring a number of best-of-breed fund managers. Kepler Partners is a corporate advisory and asset raising boutique specialising in the regulated funds market in Europe and investment trusts in the UK.