Royal London's Derek Mitchell has urged caution on the surging housebuilding sector, which has been a major contributor to mid-cap fund performance over recent months.
Stocks in the sector have soared on government support, culminating in March with the announcement of the Help to Buy scheme. A sub-sector of eight FTSE All Share housebuilders is up 42.7% for the year to the end of May, according to Morningstar, compared to 15.7% for the index. But Mitchell (pictured), manager of the £155m Royal London UK Mid Cap Growth fund, said a "bubble" was building, which could burst at the next general election. "It has been a great sector to be involved in and now we have this unbelievable scenario [of performance]," he said. "Everyone is speculating th...
To continue reading this article...
Join Investment Week for free
Signup and gain exclusive members-only insights - all free of charge!
- Unlimited access to real-time news, analysis and opinion from the investment industry, including the Sustainable Hub covering fund news from the ESG space
- Get ahead of regulatory and technological changes affecting fund management
- Important and breaking news stories selected by the editors delivered straight to your inbox each day
- Weekly members-only newsletter with exclusive opinion pieces from leading industry experts
- Be the first to hear about our extensive events schedule and awards programmes
