Miton UK Microcap Trust : MINI AGM Shareholder presentation (30/09/2017)

Miton UK MicroCap Trust plc (MINI)

• Shareholders AGM presentation

  Chairman, Andy Pomfret

  Fund Managers, Gervais Williams and Martin Turner September 2017

  THIS PRESENTATION IS TO BE READ IN CONJUNCTION WITH THE MITON UK MICROCAP TRUST PLC ANNUAL REPORT AND ACCOUNTS FOR THE YEAR ENDED 31 MAY 2017.

  Important information

  • The views expressed in this document should not be taken as a solicitation or recommendation to buy or sell, advice or forecast. We are unable to give financial advice. If you are unsure about the content of this presentation speak to your financial adviser.

  • Past performance is not a guide to future returns.

  • The value of stockmarket investments will fluctuate, which will cause fund prices to fall as well as rise and you may not get back the original amount you invested.

  • The Company may borrow money which can then be used to make further investments (gearing). In a rising market, this 'gearing' can magnify the gains or in a falling market, the losses on your investment.

  • Investment in the securities of smaller and/or medium sized companies can involve greater risk than may be associated with investment in larger, more established companies. The market for securities in smaller companies may be less liquid than securities in larger companies. This can mean that the Investment Manager may not always be able to buy and sell securities in smaller and/or medium size companies.

The absence of productivity growth remains problematic World Cumulative Productivity growth since 1990 - 2015

Source: MacroStrategy Partnership 27/03/2017.

• Long-term market returns are principally driven by the initial yield at the time of investment, and how much it changes thereafter

• Long-term dividend growth across the market is set to moderate going forward since world productivity is now flat-lining

• The fact that bond yields are at ultra-low levels, also implies that long term investment returns may be somewhat lower in future as well

  But for now market liquidity has offset the headwinds… Excess global US$ money supply - rolling 6 month annualised, %

  40

  30

  20

  10

  0

  -10

  -20

  -30

  -40

  Fed tapers

  2H 15 US$ rally

  ?

  Yellen talks down

  -50

  the US$

  2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

  Source: MacroStrategy Partnership, Bloomberg 31/07/2006 to 14/08/2017.

  • Following the Global Financial Crisis, global liquidity was revived by QE which was described as an 'emergency measure' at the time

  • Subsequently, it has become politically expedient to use additional QE at will, to offset the risk of an economic setback

  • During 2017, the US Federal Reserve has boosted market liquidity further by running down its capital surpluses

  • Collectively these factors have helped boost equity markets in spite of the lack of productivity growth