L&G UK Alpha Trust

This fund invests primarily in the micro and small cap market. By the very nature of its holdings it will have periods where it will significantly underperform and periods where it significantly outperform.

In a crowded market finding hidden gems can be tricky. The UK sector is one of those that has a vast amount of funds and in most cases the performance of the top funds is fairly similar over the long term. For the more volatile funds, to identify the good ones is much harder because they will have perhaps 2 or 3 outstanding years and then 2 or 3 poor years but overall over a 5 to 10 year period the performance is strong.

It is therefore about navigating this market to find the right fund. The L&G UK Alpha Trust is one fund which might not stick out but could be worthy of consideration. Established in May 2005 it has been managed by the same manager (Richard Penny) since launch. Its performance since launch is excellent but its shorter term performance is less strong and this might deter investors.

The fund does have a point of difference which is reflective in the performance and although the short term volatility of the fund might not appeal to all investors it may have a place with other investors. In this update with the manager we focus mainly on our concerns around the short term performance and whether there is potential to turn this around.

Fund Facts Morningstar


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