Why do UK fund buyers limit direct exposure to their domestic market?

Why do fund buyers limit exposure?

Michael Ulrich, UK mid-cap manager at F&C Investments, says investors in the UK need to ignore political noise and growth predictions when constructing portfolios.

It is still possible, although unlikely, that some professionals in the UK investment industry have not noticed the regular outperformance of the UK mid-cap market compared to both large and small caps over the last quarter of a century. Awareness of a fact is, however, not the same thing as an intention to do something about it. Currently the most fashionable reason not to buy UK equities is the forthcoming election. In particular I keep hearing: "I would not buy before the election". The only reason I know of to buy shares in a company is because you think they are likely to go up, ...