Uncovering Opportunities in the UK Small-Cap Market

The response from central banks to the economic fallout from COVID-19 has been nothing short of spectacular, but unknowns remain. Franklin UK Equity Team’s Dan Green explains how investor sentiment towards smaller UK stocks has swung between the extremes of panic and euphoria, and shares how this uncertainty can uncover opportunities in this space. Over the last few months, we’ve witnessed investor sentiment towards small-capitalisation (small-cap) stocks swing between the extremes of panic and euphoria based on daily headlines, with prices often becoming detached from underlying fundamentals.