RWC's Purves: UK corporate profits set to slide

Corporate profitability in the UK may have bounced back over the past two years but it is not likely to remain at high levels, according to RWC Partners' Nick Purves.

In an era of "ultra low interest rates" and balance sheet repair, he said, the market environment will remain tough and investors must be particularly selective in order to keep receiving a decent income on their savings. The manager of Enhanced Income fund said: "Given the amount of leveraging up we have seen in the past 20 years, we think it is reasonable to say that trend will reverse over the next ten to 20 years, making it a more difficult environment for corporate profitability. We have basically borrowed growth from our future. "The corporate profitability bounce back in 2010 a...