Talk of 'hard brexit' and sterling's slide has created a lack of clear value among both large and small UK companies, making them both stock-pickers' markets, managers have claimed.
Richard Buxton, chief executive and head of UK equities for Old Mutual Group Investors (OMGI), and Dan Nickols, manager of the OMGI UK Smaller Companies Fund, said it was important for investors to look carefully for good prospects.
"With the market pushing all-time highs, value increasingly becomes relative", he told Investment Adviser's Julia Faurschou.
"That is, with the exception of the financials. Banks and life companies remain cheap, undervalued and under-owned, in my opinion."
Mr Buxton gave the example of Barclays, which is trading at "near-half book value" despite the strength of certain divisions, such as Barclaycard.
"Financials are at 20 per cent of my portfolio", the manager of the Old Mutual UK Alpha Fund said.
Mr Nickols said: "What we have been doing pre and post-Referendum is the same. We still view the world as a low-growth, low-return place.
"The themes dominating our portfolio before the Referendum, namely a focus on structural growth companies or companies with strong cash flow, those themes work just as well in a post-Referendum environment as before.
"The change however has been in a directional shift away from consumer discretionary areas towards overseas earners, always remembering that in a small-cap fund, we have a diverse universe of companies."
Sterling's slide after the decision to leave the European Union was announced has been a crucial factor for investors looking to consider which areas of the stock market they should be investing in, according to Mr Buxton.
He said: "The huge proportion in the FTSE 100 of overseas and dollar-denominated companies means for me, the UK stock market is well placed, precisely because it is not reflective of the UK economy and will continue to benefit from weakness in the currency."
Mr Nickols added: "Although some companies are benefiting from the tailwinds of a weak sterling, there could be issues in terms of future growth. Growth, or earnings growth, over the next year or so is probably going to be harder, especially further up the market cap register as you get a greater proportion of companies benefiting from those tailwinds higher up the market cap.
"That said, it is a stock pickers' market so we have plenty of good companies to go at but in index terms it might be slightly more difficult for us."
According to Mr Buxton, eyes will be on the new chancellor, Phillip Hammond, to see whether his Autumn Statement will be "fiscal light" with reductions in petrol duties or cutting stamp duty on housing transactions or go "fiscal heavy" with more gilt issuance and spending on infrastructure.