All equity markets go through periods of outperformance and underperformance. The US stock market, which seems to have investors transfixed right now, underperformed global markets by more than 25 per cent between 2008 and 2020.
Even by historical standards, the degree of underperformance being endured by the UK market is extreme. It has underperformed global markets by 35 per cent since the Brexit vote in 2016.
The market trades at a 22 per cent discount to the global market and a 39 per cent discount to the US market on a price-to-earnings basis.
In the global stock market, which carries more valuation risk right now than at any time in the past 20 years, we believe the UK stands out as an opportunity.