JPM cuts gearing on Mid Cap IT as outlook worsens

The manager of the £109m J.P. Morgan Mid Cap investment trust has significantly reduced the fund's gearing on concerns over the UK economic outlook.

Since March, Jane Lennard has cut gearing from 12% to 2.5%. “You can see our macro view from the level of gearing,” she says. “Although valuations do not look demanding, there are headwinds to the economy as cuts bite.” Lennard took money out of the market by selling companies that had received takeover approaches, such as Arriva and Chloride. “At the beginning of this year we expected M&A activity to be one of the drivers of this market, and we have started to see that coming through,” she says. “We were able to sell Chloride at a 10p premium to the bid price.” The manager h...