UK small caps have struggled against their larger cap peers in recent months, but if you can avoid the banana skins there are some very attractive entry points for businesses, according to Ken Wotton, manager of Strategic Equity Capital investment trust.

In this interview, Wotton tells the IC’s Mary McDougall where he thinks the best opportunities are, why he likes to run concentrated portfolios and what he has been buying and selling recently. He also describes how he approaches valuing companies, to what extent macro economic factors play into his decision making and what he wishes he had known when he started his career.

Timestamps:

00:00 - Intro

01:35 - Outlook for UK small caps

03:30 - Preferred valuation metrics

04:55 - Profitable holdings

05:48 - Macro factors effecting investment decisions

08:40 - Changes to Strategic Equity Capital since you took over

12:28 - Largest proportion of a company you own?

14:07 - Would you consider yourself an activist investor?

15:05 - Fund size

16:12 - Favourite holdings

20:10 - M&A as part of investment case

22:25 - Quality UK PLC's leaving the market

23:52 - Participating in IPO's

24:39 - Healthcare and financial services sectors

26:57 - Filtering companies

28:05 - Areas of expertise

29:58 - Advice for your past self

31:02 - A book that's influenced you

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Ken Wotton: Volatility is throwing up really interesting opportunities

Investors' Chronicle

Ken Wotton: Volatility is throwing up really interesting opportunities