Investec Wealth's Summers: Industry still lacks active UK large-cap funds

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Fund groups should focus more attention on the need for active UK equity funds that are overweight large caps, according to Andrew Summers, head of fund research at Investec Wealth & Investment.

The typical UK equity fund had between 50% and 60% in UK large caps last year, according to Morningstar, with the rest lower down the cap scale. That made for a difficult 2014 for most as the relative underperformance of small-caps caught them out. The FTSE Small Cap (ex-ITs) index closed down 3.8% last year, compared with a 0.7% rise for the FTSE 100, and many of the mid-cap success stories of 2013 also suffered. The blue-chip index has also outperformed both small and mid caps year to date. Summers’ desire for more funds with large-cap overweights comes from a desire for more flexib...

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