Schroder UK Alpha Plus fund

Andy Parsons, head of investment research at The Share Centre, examines the Schroder UK Alpha Plus fund for investors seeking capital growth through UK equity exposure.

"The Schroder UK Alpha Plus fund is managed by the widely respected head of UK equities at Schroder's, Richard Buxton, who brings 26 years of investment experience to the fund.

"The fund has recently celebrated its tenth anniversary and in that time, aside from periods of volatility, the net effect has been that the stock market has more or less gone sideways.  Whilst there are a variety of headwinds and negativity still facing the economy, Richard believes these are already widely known.

"With a process focused on high conviction stock ideas, the fund has stood the test of time through strong and weak markets. It may have sometimes underperformed its benchmark index, however it has clearly outperformed both its sector and benchmark over the past ten years. The fund has a truly concentrated portfolio of around 30 to 40 large and mid cap stocks, which can mean investment returns are volatile.

"Although growth in the UK remains sluggish, the manager believes he can still find attractive companies, with good valuations and growth opportunities, which should make investors money over the longer term. Buxton is happy to wait years for his convictions to pay off.

"The fund's current top 10 holdings include GlaxoSmithKline, Tate & Lyle and Royal Dutch Shell. In addition to holding a number of FTSE100 stocks, the fund clearly shows Richard's appetite to actively seek companies he believes offer compelling valuations outside of this arena, such as Debenhams, Taylor Wimpey and Drax.

"Finally, in terms of sector exposure, the top two sectors are services and financials. Richard firmly believes he can make money from the financial sector over the longer term by investing in UK banks. He believes this is due to the changes made since the banking crisis in 2008 that have made them stronger."