April through to June was another strong quarter for the 60 guru-inspired investment strategies tracked by Stockopedia. Followers of Paul Scott and Graham Neary, who write our daily small-cap reports, will know that many growth stocks have been flying for months. And that’s exactly what we’ve seen in our screens modelled on the legends of finance: small-cap growth has been in a sweet spot. But there have also been winners right across the strategy styles.

As expected, the second quarter carried on the trends we saw earlier this year. Growth lead the pack, but Income, Value and Momentum strategies all held up well, while Quality still lagged.

Index valuations stalled and drifted lower in June, which meant it was a flat quarter for the market. There are various possible reasons for that. It could be the market’s just taking a breather as we head into what are usually the quietest months of the year. Certainly Paul has mentioned that those growth stocks that fail to keep up the pace with their earnings forecasts are being punished severely. So it’s clear that there are concerns about stretched valuations in some places.

Index / Strategy Composite

Q2 2017 Performance

12 Months Performance

FTSE 100

-0.1%

+12.4%

FTSE All Share

-0.2%

+13.8%

FTSE 250

+1.7%

+18.9%

FTSE SmallCap XIT

+1.7%

+24.8%

AIM 100

+6.6%

+43.4%

Guru Strategy Composite

+5.4%

+32.7%

Growth Composite

+8.3%

+51.9%

Income Composite

+6.3%

+28.8%

Value Composite

+5.5%

+24.9%

Momentum Composite

+3.9%

+33.8%

Bargain Composite

+3.8%

+37.0%

Quality Composite

+2.8%

+23.4%


A note about the guru strategies

We’re now into the sixth year of tracking these strategies and they’ve become a useful barometer of what’s working in the market, and how different styles behave over time.

As always, here’s a primer for those new to Stockopedia. These strategies cover a range of approaches used by some of the world’s best known investors. They’re categorised as either Quality, Growth, Value, Bargain, Income or Momentum.

Each strategy has its own set of rules, and we constantly screen the market for companies that meet them. At the end of each quarter, the companies passing the rules are held in a portfolio for each strategy, which we track. The models aren’t always realistically investable, and sometimes there may be few companies that meet the rules of some of them. In addition, we don’t account for the drag of trading costs or the bonus of dividend payments.


It has been a decent 12…

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