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Liontrust roars into action
Asset management firms can be a nerve jangling investment as some of the big names in the industry hit the headlines with multi-billion pound outflows.
In contrast Liontrust (LIO) is one of the top performers in the sector and there’s scope for this firm to keep its momentum going.
The firm’s acquisition of Alliance Trust Investments (ATI) completed at the beginning of April, adding £2.5bn to its assets under management (AUM) to a total of £9.1bn.
When this deal was announced in December ATI had £2.3bn in AUM, so investors clearly trust Liontrust’s portfolio managers as they haven’t withdrawn their cash.
Risks do persist in asset management. Investor sentiment can change quickly and the ever-looming presence of greater regulation in the industry means companies face increasing compliance costs.
However, Liontrust’s diverse range of products, including special situation and European growth funds, should mean it is well placed even if the macro-economic backdrop is choppy.
Liontrust trades at a discount to asset value despite a stron AUM figure and consistent earnings growth. Buy at 422.62p