Most US small caps to survive US-China trade war 


A number of US small-cap companies will remain completely unaffected by the ongoing trade war between the US and China, according to Miton. 

Nick Ford, co-manager of the Miton US Smaller Companies fund, said: "Certain sectors of the market aren’t really immune but if you look at the auto-sector, that is clearly being impacted by the trade war as a lot of companies sell into the automotive space."

But Mr Ford said the US restaurant industry would thrive despite the trade war. 

"America has always been a good place if you have got a promising new restaurant concept. So if you have a good restaurant concept, you have thousands of towns to open a restaurant and you can grow for a number of years without having to go abroad," he explained. 

Mr Ford added: "I like to use the example of Wingstop, which is a restaurant offering chicken wings. It is popular and growing very fast."

He said he was focusing on investing in three main sectors in the US small cap market. These are: consumer discretionary, technology and the healthcare space. 

"I would list the consumer discretionary space, the technology space and the healthcare space. That is where you find some of the most innovative companies," Mr Ford said. 

Asked whether any particular companies stand out for him, Mr Ford, said: “The first one would be Everbridge- which provides platforms to deliver instant messaging services to keep people safe from things like terrorist attacks and adverse weather events. 

The second company he highlighted was Carvana, which he said is “revolutionising the way people buy used cars in America”.

Mr Ford's fund, which was launched in 2018, has outperformed its sector over the past year, returning 13 per cent while the IA North American Smaller Companies sector returned 6.4 per cent.