- In 2018, the value style continued to struggle despite the previous headwinds from bond proxies and tech stocks abating
- Looking ahead, we recognise that risks exist: the US economy is arguably closer to the end of the cycle than the beginning, whilst corporate earnings growth has slowed.
- This represents a challenge, particularly for companies on high valuations and with high embedded expectations. On a risk/reward basis, we believe that cheap companies with low expectations represent an appealing prospect.
- We currently see value opportunities right across the market – in most sectors the fund’s holdings are cheaper than the S&P 500 sector valuation
- With cheap valuations and robust fundamentals we think the fund is in a good position to withstand any further turbulence and participate in a potential value recovery.
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Please note that the value of investments and the income from them will fluctuate. This will cause the fund price, as well as any income paid by the fund, to fall as well as rise. There is no guarantee the fund will achieve its objective, and you may not get back the amount you originally invested.