Omam’s Watts buys into domestic UK stocks
UK mid cap equity manager tops up domestic exposure in bid to maintain outperformance.
Old Mutual Asset Managers’ Richard Watts has continued to buy more UK domestic-focused stocks as he seeks to maintain his fund’s top quartile performance.
Mr Watts, manager of the £750.4m UK Select Mid Cap fund, said the UK and European macroeconomic picture had not changed in spite of the “risk on, risk off” volatility caused by weekly newsflow from the continent.
“We recognise that the outlook for European growth is not great and the outlook for the UK economy is not particularly good either, but that’s not new news,” Mr Watts said.
“We have been dealing with this for some time now. Where we’ve positioned the fund is to try and be ‘macro neutral’ - not taking a strong top down view relative to the benchmark, but trying to add value through stockpicking.”
The manager has topped up a holding in bookmaker William Hill, citing its online gaming business as a “substantial driver of profits”, and has also added to technology firm Laird Group and broadband provider TalkTalk.
Mr Watts has been gradually bringing in UK-focused companies since the beginning of the year, citing a belief that “the worst is over” for the UK consumer.
The Old Mutual UK Select Mid Cap fund posted a top quartile gain of 13.7 per cent over five years to July 10, according to Morningstar, compared with a 1.8 per cent average loss posted by the IMA UK All Companies sector.