THE FUTURE IS SMALL

Why AIM will be the world’s best market beyond the credit boom.

by Gervais Williams

The Future is Small - book by Gervais Williams

NEW BOOK OUT 11th NOVEMBER 2014

In a world dominated by gigantism, the beauty of smallness hasn’t had much of a look in. Yet beyond the credit boom, globalisation has been found wanting. This book confounds the consensus, as Williams’ extraordinary factual data outlines why smallness offers an effective path for investors to explore beyond the financial crisis. This book is about so much more than just the case for small being beautiful. It explains why the unique characteristics of AIM – the UK market for smaller, growing companies – will be a place of extraordinary vitality in the coming years.

 

ABOUT THE BOOK

 

The Future is small

The Future is small


THE FUTURE IS SMALL highlights that the imbalances built up prior to the financial crisis have not been resolved. World growth has stalled declined despite giant quantities of capital being injected via quantitative easing and record low interest rates being sustained for years and years. Investors now appreciate that sub-normal economic growth is here for the longer term. But if growth is lower for longer, it won’t be effective to invest following pre-crunch trends.

The boom years were characterised by growing indebtedness and scaling up; mid and large scale companies were able to take greatest advantage of the wider economic trend. The post-crisis years need a different approach.

THE FUTURE IS SMALL explores a world where most larger companies don’t grow much. It looks at the evidence and asks if there are better ways to invest – paths relevant to the domestic economy with scope for premium returns too. It suggests that the best opportunities for investment outperformance in the future will be found in the universe of small listed companies, most particularly among the smallest stocks listed on the UK’s Alternative Investment Market (AIM).

“The uncomfortable truth is that without decent growth, there are few parts of the investment universe that have attractive growth prospects. This includes the emerging markets, where heightened investment risks are becoming more obvious. This is exactly why the advantages of smallness are beginning to attract a little more attention.”

Gervais Williams, 2014


“I heartily recommend this volume to any reader willing to decide for themselves how to deploy their savings.”

Luke Johnson, Chairman, Risk Capital Partners

ABOUT THE AUTHOR

 

Gervais Williams

Gervais Williams

 

 

Gervais Williams, Managing Director, Miton Group plc

Gervais Williams is an award-winning equity fund manager and Managing Director of Miton Group plc. He has worked in the City since 1985, managing clients’ investments in small to medium-sized UK companies.

As a professional investor, Gervais has exceptional credentials. He is one of the country’s best-known champions of smaller, home-grown businesses.

Gervais grew up in Monmouthshire and studied marine and structural engineering at Liverpool University, before moving into fund management.

2014 – What Investment Fund Manager of the Year
2014 – What Investment Fund Group of the Year
2014 – The Small Cap Awards Fund Manager of the Year
2012 – Investment Company Of The Year Awards Winner Best New Issue, Diverse Income Trust plc

 


I know first-hand the excitement and disappointments that come with backing companies at an early stage. THE FUTURE IS SMALL came about as a result of my own experience, which I’ve lived because I  manage a smaller listed company myself, and from a lifetime of investing.

THE FUTURE IS SMALL – Gervais Williams

KEY THEMES

THE NEED FOR CHANGE

“The allocation of our collective savings reflects the themes of the past. But these market trends are reliant on debt continuing to rise, which quite clearly conflicts with systemic constraints. We need to think differently.”

EVIDENCE OF THE POWER OF SMALLNESS

“Growth amongst small firms has distinct differences from growth amongst larger companies. It’s less dependent on general economic expansion. In a period when world growth is sub-normal, this is highly relevant.”

COMBINING SMALLNESS WITH OTHER INVESTMENT CHARACTERISTICS FOR PREMIUM RETURNS

“Generally the smaller the company, the better the potential return. Equally, the lower the stock’s market liquidity, the better its potential return too.”
“look for stocks where investors have already been disappointed and expectations are rock bottom….

THE BENEFITS OF INVESTING IN UK COMPANIES

“The purpose of investing is allocating to those businesses which can deliver more economic growth and more wealth and more jobs. If we invest in genuinely small domestic companies, there’s lots to gain. If we shovel money elsewhere, we lose potency in terms of allocation of capital.”

THE UNIQUE FEATURES OF AIM

“Stocks quoted on AIM are superbly well-positioned to benefit from renewed focus on the positive characteristics of smallness, exhibiting features that have been proven to be powerful return generators in the past.”

ANTICIPATING THE SMALL SUPER-CYCLE

“Buying into portfolios of individually selected, genuinely small stocks with premium growth potential will become noticeably more difficult as investors start to allocate more capital into these companies.”
“We are in the early stages of a multi-year period of small companies’ outperformance – a new super-cycle of returns from the smallest quoted stocks”


PRESS / REVIEWS

GERVAIS WILLIAMS in the PRESS:

  • Zak Mir: Book review “I would encourage you to read The Future is Small for many reasons - remembering that the FTSE 250 has tended to outperform the FTSE 100, that small caps are under researched and suffer the greatest valuation inefficiencies, and being aware of the small company effect. The latter effect simply states that the smaller the company, generally the better the performance.” Read more - Spreadbet Magazine

    Spreadbet Magazine

    12th Nov 2014

  • David Stevenson: FT Columnist, editor of Portfolio Review and consultant “In his new book, The Future is Small, Gervais picks up many of the ideas from that first book [Slow Finance], but makes two bold claims, one of which I think is spot on...’ Read more - Investment Week

    Investment Week

    7th Nov 2014

  • Ian Lyall: The investment world is changing; think small, think long-term, says top fund manager   The Investment World According to Williams - 25-year credit boom is coming to an end - So investors will have to work harder - Local markets a key source of opportunities - Avoid speculative emerging economies - Dividend-paying small-caps most attractive Read more on the Proactive Investors

    Proactive Investors

    7th Nov 2014

  • Gary Parkinson: Trade Secrets: small is a beautiful bet to make One of the last fund managers still prowling AIM is not, by inclination, a risk-taker. Seven, maybe eight, years ago, Gervais Williams found himself in a casino somewhere in the West End. Then Gartmore money manager, now running the show at Miton, he was with pals from the sales desk of a big brokerage on a night out... Read more - The Times

    The Times

    10th Nov 2014

  • Book Extract: Why big is no longer beautiful Something intriguing happens when you ask a man who’s just placed a bet about his chances of winning. His outlook becomes just a little more optimistic than the person still waiting in the queue to hand over his money... Read more - The Sunday Times

    The Sunday Times

    9th Nov 2014

  • Book Extract: Smaller is better for a bigger return, says top fund manager UK equity portfolios typically invest in the largest 350 quoted companies – and stocks such as pharmaceuticals group Shire plc and technology group ARM have done really well over the last 20 years... Read more - This is money

    This is money

    14th Nov 2014


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THE FUTURE IS SMALL – GERVAIS WILLIAMS

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