While many wealth and fund managers have taken a more defensive stance in recent weeks ahead of the referendum vote, the Old Mutual UK Alpha Fund manager pointed to bookmakers’ odds which have remained 2/1 on for the UK to remain part of the EU.
“The British electorate is in inheritably conservative – with a small ‘c’ – so you should ignore the polls and focus on what the bookies say because they are invariably always right,” he said.
He added: “Market jitters, ahead of the EU referendum vote on 23 June, are at complete loggerheads with what UK company bosses are telling us.”
Co-manager Ed Meier backed up Buxton’s view, acknowledging that UK Alpha Fund is not positioned to outperform should Brexit occur.
The fund is currently languishing in the UK All Companies sector, having lost 11% over the past 12 months, its performance dragged down by its financials exposure.
Recent changes include the sale of Reed Elsevier (sold at 20x earnings having been bought at 12x) and Unilever.
The managers are sticking with Lloyds, its share price having been boosted by its special dividend in February, while having conviction in “recovery stories”, Tesco, Ladbrokes and Debenhams.
