SVM UK Opportunities Fund
Fresh thinking never goes out of style
The Fund, led by Neil Veitch, looks to achieve positive returns by identifying and investing in organisations with sound business models where he believes the current market valuation offers an opportunity. The Fund can invest in businesses of any size.

SVM UK Opportunities Fund
Fresh thinking never goes out of style

The Fund, led by Neil Veitch, looks to achieve positive returns by identifying and investing in organisations with sound business models where he believes the current market valuation offers an opportunity. The Fund can invest in businesses of any size.
Overview
Investment Objective
The objective of this Fund is to achieve capital growth over the long term (5 years or more) and it aims to outperform the MSCI United Kingdom IMI.
Investment Policy
The Fund will identify investment opportunities in UK companies whose future growth is not reflected in current market expectations. The Fund will invest at least 80% in equities and equity related instruments in UK companies. The Fund may invest in other permitted securities.
The fund uses derivatives for efficient portfolio management and investment purposes. The use of derivatives is intended to be limited.
Approach
We believe the basis of successful investing is simple. We aim to find good businesses that we can buy at an attractive price.
But it’s important how we define and identify those characteristics in detail. We don’t see value and growth as two different measures or types of investment; and we don’t measure them on the basis of current earnings and share prices.
Rather than value or growth, we invest on the basis of the value of growth. We want to find strong companies for your portfolio whose future growth is not reflected in current market expectations. We believe these companies have an attractive positive bias in their risk-reward profile which makes them potentially rewarding investments in your portfolio.
Investing in this fund, you will be buying a concentrated portfolio of companies of any size with strong, undervalued long-term prospects. You can invest with confidence in our ability to find these companies, based on our long history of comprehensive UK company analysis and financial modelling, and our understanding of what’s changing in companies and their industries.
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Fund Details
Launch Date | 20 March 2000 |
Benchmark | MSCI United Kingdom IMI Index |
IA Sector | UK All Companies |
Type of Shares | Accumulation |
XD Date | 31 December |
Pay Date | 30 April |
Fund Size | £124.5m |
Data as at 31/10/2023.
Fund Managers

Neil joined SVM in 2006 to manage the SVM UK Opportunities Fund. He is also lead manager of the SVM World Equity Fund and co manager of the SVM All Europe SRI Fund.
Prior to joining SVM, Neil was responsible for UK mid & small cap investments at Dutch merchant bank, Kempen Capital Management, where he also managed pan European mandates.
Professional Qualifications:
CFA

Craig joined SVM in 2006 and is responsible for SVM's SRI and Corporate Governance analysis. Craig also assists the portfolio managers in equity research.
Professional Qualifications:
CFA
Portfolio
Risk Baskets
To help understand the overall balance of the portfolio, stocks are allocated to one of eight risk groups: defensive, cyclical, stable financial, unstable financial, consumer cyclical, oil & gas, mining and finally technology. Most of these groups are self explanatory but financials deserve some clarity. All financials are inherently unstable, but in the main, Lloyd’s underwriters and General Insurers take less balance sheet risk, so are relatively more stable than Banks or Life Assurers.
Seeing the portfolio broken down into these categories allows an understanding of how aggressive or defensive the overall portfolio is, and where risk is being taken.
CRH | 5.7 |
IMI | 5.0 |
Smurfit Kappa Group | 4.4 |
Alpha FMC | 3.0 |
Inchcape | 2.6 |
Entain | 4.0 |
Norcros | 4.0 |
Ryanair | 3.8 |
Marks & Spencer | 3.3 |
Tesco | 3.1 |
Lloyds Banking Group | 4.1 |
Prudential | 3.5 |
Aviva | 3.0 |
Legal & General | 2.9 |
OSB Group | 1.0 |
DCC | 4.0 |
GSK | 3.9 |
Smith & Nephew | 2.3 |
Indivior | 2.1 |
Diageo | 1.7 |
Jadestone Energy | 3.4 |
Energean | 3.1 |
Savannah Energy | 2.3 |
Jersey Oil & Gas | 0.7 |
Longboat Energy | 0.6 |
Broadcom | 3.1 |
Creo Medical Group | 2.3 |
ActiveOps | 1.0 |
There are no holdings in this category
There are no holdings in this category
There are no holdings in this category
There are no holdings in this category
There are no holdings in this category
Portfolio Structure
As an unconstrained fund we invest in our highest conviction ideas irrespective of market capitalisation or sector. As a consequence the SVM UK Opportunities Fund portfolio will vary considerably from the benchmark index and from other funds that are in the same IA sector.
Top 10 Holdings (%)
Source: SVM, as at 31/10/2023
Sector Exposure (%)
Source: SVM, as at 31/10/2023
Size Analysis (%)
Source: SVM, as at 31/10/2023
This Month's Featured Stock
Marks and Spencer
Marks and Spencer (M&S), one of the UK’s most venerable brands, is a retailer of food and clothing. The group operates over 1,000 stores in the UK and has a mixture of owned and franchised stores in over 60 international markets.
M&S’ recently released interims results provided clear evidence of the improvements made across the business. Clothing & Home (C&H) sales increased by 6% with the group gaining market share. For the first time since 2019, M&S had a market-leading share in womenswear over the summer. This reflects the significant improvements that have been made in boosting M&S’s style perception over recent years. Full-price sales mix of over 80% reflects a reduced need for discounting and good buying discipline. Having added a number of third-party brands to its online offering and improved its own infrastructure, M&S has built a strong platform for future growth. The group’s food division had another strong period, with LFL revenue growth of 12% and grocery market share. During a period when the market saw volumes decline, M&S consistently grew volumes in each month.
M&S’ management like to describe themselves as ‘positively dissatisfied’ and indeed there are still many areas where performance can be improved. The Ocado joint venture remains loss-making and the group’s reward scheme, Sparks, is still some way short of best-in-class. Overall, though, we still think that at current levels the share price fails to reflect M&S’s qualities or its potential for improvement.
Performance
Performance (%)
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Prices
SVM funds are priced every working day at 12 noon UK time and prices are updated here shortly afterwards.
Source: State Street, as at 01/12/2023.
Literature
- 2023
- 2022
- 2021
Insights
Availability
The fund is a sub-fund within the SVM ICVC Fund, a UK domiciled Open Ended Investment Company, with UCITS status. The Funds are regulated by the UK Financial Conduct Authority.
Dealing into the fund is available daily. Deals are accepted on a forward pricing basis, with 24 hours notice. SVM employs SS&C Financial Services International Limited and SS&C Financial Services Europe Limited as third party administrator and transfer agent to our funds.
How to Invest
You can invest directly with us or through a wide variety of third party wraps, supermarkets and life companies.
For each fund in the SVM ICVC range we offer a B share class which is our lowest priced clean share class.
Share class availability via third parties varies depending on their model.
Dealing - Funds
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Professional Adviser Helpline
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Literature Requests
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Commentary
October, as is often the case, was a challenging month for equities. The prospect of higher US growth and concerns over government debt sent long-term US interest rates to 16-year highs. The surge in rates led to fears that the tightening in financial conditions would increase the downside risks to the economic outlook and increase the possibility of financial market breakdowns. The co-ordinated attacks launched by Hamas into Israel from the Gaza Strip negatively impacted sentiment further. With increased risk aversion, small and mid-cap stocks underperformed. The fund returned -7.3% versus the MSCI UK index that fell 4.0%.
The tragic events in the Middle East gave rise to concerns that additional countries would be drawn in, resulting in a wider regional conflict. It is difficult to see, though, how any of the regional powers would emerge from a broader conflict in a better position. Our base case therefore is that, like the war in Ukraine, it will eventually become more horrific background noise than something that is going to meaningfully impact financial markets. The outlook for inflation will remain the key determinant of equity market direction. Recent news flow has been encouraging. Inflationary pressures continue to ebb and the Federal Reserve voted unanimously to leave rates unchanged at its latest meeting.
The economic outlook for 2024 has weakened and earnings in cyclical sectors may come under pressure, but financial markets are a discounting mechanism. Small and mid-cap stocks have been in a bear market since 2021 in anticipation of weaker economic growth. However, as investors begin to anticipate the turn in the interest rate cycle, and better economic times ahead, the outlook becomes much brighter. Cyclical stocks consistently return significantly more than defensives in the twelve months after a recession is declared.
Energean was the largest negative contributor to performance. The company’s Karish gas field, located in the Eastern Mediterranean Sea, supplies 100% of its production to Israel. Disruption to production cannot be completely ruled out and the initial sell-off is understandable. The field, however, is capable of meeting more than 50% of Israel’s domestic gas demand and is highly important to the Israeli state. Production is contracted out to 2032 and the cashflows are significant, enabling the company to pay a sizeable dividend.
Holdings in Easyjet and Ryanair declined in response to the prospect of higher oil prices. Concerns over the 2024 demand outlook continue to weigh on shares, but that is only one side of the equation. European short-haul capacity remains below 2019 levels and we believe pricing will remain robust. UK banks were weaker as results from Natwest led to fears that increased deposit pricing would significantly impact earnings. Cyclical stocks were generally weak.
Alpha Financial Consulting rose as its interim results revealed that improved operational momentum gave it confidence for the full year. Post a previous cautious outlook statement, investors had been concerned that its full year profit guidance was unachievable. Aviva rose after ill-founded takeover speculation.
October, as is often the case, was a challenging month for equities. The prospect of higher US growth and concerns over government debt sent long-term US interest rates to 16-year highs. The surge in rates led to fears that the tightening in financial conditions would increase the downside risks to the economic outlook and increase the possibility of financial market breakdowns. The co-ordinated attacks launched by Hamas into Israel from the Gaza Strip negatively impacted sentiment further. With increased risk aversion, small and mid-cap stocks underperformed. The fund returned -7.3% versus the MSCI UK index that fell 4.0%.
The tragic events in the Middle East gave rise to concerns that additional countries would be drawn in, resulting in a wider regional conflict. It is difficult to see, though, how any of the regional powers would emerge from a broader conflict in a better position. Our base case therefore is that, like the war in Ukraine, it will eventually become more horrific background noise than something that is going to meaningfully impact financial markets. The outlook for inflation will remain the key determinant of equity market direction. Recent news flow has been encouraging. Inflationary pressures continue to ebb and the Federal Reserve voted unanimously to leave rates unchanged at its latest meeting.
The economic outlook for 2024 has weakened and earnings in cyclical sectors may come under pressure, but financial markets are a discounting mechanism. Small and mid-cap stocks have been in a bear market since 2021 in anticipation of weaker economic growth. However, as investors begin to anticipate the turn in the interest rate cycle, and better economic times ahead, the outlook becomes much brighter. Cyclical stocks consistently return significantly more than defensives in the twelve months after a recession is declared.
Energean was the largest negative contributor to performance. The company’s Karish gas field, located in the Eastern Mediterranean Sea, supplies 100% of its production to Israel. Disruption to production cannot be completely ruled out and the initial sell-off is understandable. The field, however, is capable of meeting more than 50% of Israel’s domestic gas demand and is highly important to the Israeli state. Production is contracted out to 2032 and the cashflows are significant, enabling the company to pay a sizeable dividend.
Holdings in Easyjet and Ryanair declined in response to the prospect of higher oil prices. Concerns over the 2024 demand outlook continue to weigh on shares, but that is only one side of the equation. European short-haul capacity remains below 2019 levels and we believe pricing will remain robust. UK banks were weaker as results from Natwest led to fears that increased deposit pricing would significantly impact earnings. Cyclical stocks were generally weak.
Alpha Financial Consulting rose as its interim results revealed that improved operational momentum gave it confidence for the full year. Post a previous cautious outlook statement, investors had been concerned that its full year profit guidance was unachievable. Aviva rose after ill-founded takeover speculation.
Independent thinking
Monthly analysis and insights from our fund managers