Some 93% of discretionary fund managers, private banker fund selectors and IFAs see UK equities as a “generational valuation opportunity”, according to research commissioned by Rathbones Group.
The report, conducted by independent research agency PureProfile, interviewed 100 UK-based investment professionals during July 2026.
It found that, over the past year, 74% of fund selectors have increased their portfolio allocation to UK stocks, while 25% made no change. Only 1% reduced their exposure to UK equities.
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Within this, 74% of investors have invested directly in stocks to create their own custom portfolios, while 6% exclusively use passive index-tracking vehicles and just 3% use only actively-managed funds.
UK mid caps proved particularly popular, with 98% likely or very likely to increase their exposure to this part of the market before the end of the year.
However, the biggest UK-specific headwinds investors are keeping a close eye on are market concentration – particularly within the FTSE 100 index, with 10 firms accounting for more than a 50% weighting overall.
Some 16% of those surveyed see this as a “critical” concern, while 72% are moderately concerned.
Alexandra Jackson (pictured), director of equities at Rathbones Asset Management, said: “While many of the FTSE 100’s largest constituents are exceptional businesses with international revenue streams and attractive dividend characteristics, relying too heavily on a small number of companies can limit diversification and increase portfolio risk over time.
“This is where active management can add value. It gives investors the flexibility to look beyond the index, balancing exposure to high-quality large-cap names with carefully selected mid-cap and underappreciated businesses that offer long-term growth potential and exposure to new themes.”
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