Merryn Talks Money There’s a Stock Picker’s Paradise Waiting for You
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Mar 28, 2025 Alyx Wood, Chief Investment Officer of Kernow Asset Management and expert in UK equities, shares his contrarian investment strategies. He discusses the unique opportunities in the UK market, particularly for active stock pickers. Alyx highlights his focus on medium-cap companies and specific cases like Burberry, emphasizing potential growth. The conversation also touches on the impact of activist investors and explores strategies involving gold as a hedge. Throughout, he underlines the importance of emotional resilience in navigating market fluctuations.
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Index Hugging Creates Stock-Picker Opportunity
- Index-hugging has compressed active managers' returns and reduced true active opportunities in many markets.
- Alyx Wood says this creates huge pockets of mispriced value for genuine, contrarian stock pickers.
UK Market Is A Stock-Picker's Paradise
- The UK market has extreme dispersion with many potential ten-baggers alongside many poor businesses.
- Alyx Wood calls it a "stock picker's paradise" because that flat distribution creates tail opportunities.
Move To Where The Value Is
- Go where the value and biggest opportunity gap is, regardless of market cap.
- Alyx Wood says focus depth on chosen ideas and shift sizes as gaps appear.