Is it time to take profits from UK smaller companies funds?

The FTSE Small Cap index has risen sharply for ten consecutive months, but is there still value in the UK small cap space or should investors take profits and look elsewhere?

Smaller companies in the UK - like peers globally - have been one of the main winners in the recent rally, with share prices outpacing gains made by larger peers. From the end of May last year, the FTSE Small Cap index (ex investment trusts) is up 34.39%, versus FTSE 100 and FTSE All Share returns of 20.82% and 22.46% respectively. Paul Stevens, fund manager on the Smaller Companies team at Octopus Investments, believes this trend will continue, as the index is still trading at a 20% discount to its 2007 high, unlike the FTSE 100 which is much nearer to its record peak. He said rec...