Henry Dixon: The bull and bear case for the UK

While the yield attractions of equities have rarely been so strong relative to bonds, it is undoubtedly right that a significant amount of commentary is currently devoted to record levels of net debt and shrinking dividend cover.

In aggregate this is impossible to refute, but we note just how concentrated the majority of debt is within the UK market.  This means that through a focus on net cash balance sheets and superior free cashflow yields, it is possible to construct a portfolio where the dividend not only looks sustainable, but can also display growth ahead of expectations.  Investors remain positive on UK despite post-election political uncertainty The latter point here is an important one as the market handsomely rewards those companies that beat expectations and our focus is therefore on marrying lo...