Artemis SmartGARP UK Equity Fund
Q1 2026 update
Source for all information: Artemis as at 30 March 2026, unless otherwise stated.
CAPITAL AT RISK. All financial investments involve taking risk and the value of your investment may go down as well as up. This means your investment is not guaranteed and you may not get back as much as you put in. Any income from the investment is also likely to vary and cannot be guaranteed.
This is a marketing communication. Before making any final investment decisions, and to understand the investment risks involved, refer to the fund prospectus (or in the case of investment trusts, Investor Disclosure Document and Articles of Association), available in English, and KIID/KID, available in English and in your local language depending on local country registration, available in the literature library.
Fund objective
The fund’s objective is to grow capital over a five-year period.
Positioning
The fund is firmly at the value end of the spectrum (meaning it invests in companies that are cheaper than the stockmarket) but, as ever, we are also focusing on companies whose profit forecasts are being upgraded. Over the years, we feel this has proven to be a sensible and profitable strategy and we see no reason to doubt it.
Performance
The Artemis SmartGARP UK Equity Fund made 0.3% in the first quarter of the year, compared with gains of 2.4% from its first benchmark, the FTSE All-Share index1, and a loss of 2.1% from its second benchmark, the IA UK All Companies sector average2.
Discrete calendar-year performance
| 2025 | 2024 | 2023 | 2022 | 2021 | |
|---|---|---|---|---|---|
| Artemis SmartGARP UK Equity Fund | 39.9% | 24.5% | 3.6% | 6.3% | 30.8% |
| FTSE All-Share TR | 24.0% | 9.5% | 7.9% | 0.3% | 18.3% |
| UK All Companies Sector Average | 14.7% | 7.9% | 7.2% | -9.3% | 17.1% |
Past performance is not a guide to the future. Source: Lipper Limited, class I accumulation units, to 31 December 2025. All figures show total returns with dividends and/or income reinvested, net of all charges. Performance does not take account of any costs incurred when investors buy or sell the fund. Returns may vary as a result of currency fluctuations if the investor's currency is different to that of the class.
Contributors/detractors
The main cause of our relative underperformance was being light in oil stocks at a time when these rose sharply3. We responded by buying Shell and BP. Our position in bank Lion Finance also detracted from returns.
On the other hand, our positions in energy company Repsol and trading portal IG Group contributed to performance, while having no exposure to Unilever – which fell sharply in March – worked in our favour.
Activity
It might be helpful to use HSBC as a topical example of how we invest. HSBC is the second biggest stock in the UK market4 and, until recently, we held none of its shares in the portfolio. We liked banks but preferred others such as Barclays, Lloyds, NatWest, Lion Finance and Standard Chartered.
However, in February HSBC announced strong results and analysts raised their 2026 profit forecasts by more than 6%5. At about the same time, Barclays (which was a 5% position in the fund) delivered good results, but forecasts only crept up marginally6 and were subsequently downgraded7.
Since we had an underweight (lower-than-average position compared with the stockmarket) position in HSBC and felt it was lower risk than Barclays, we raised our position in the former and cut it in the latter.
Over the years we have switched between HSBC and Barclays, depending on which one we expect to outperform. We owned HSBC from March 2022 until March 2024, then moved into Barclays for the next two years. Now we consider ourselves to be fans of HSBC once again.
We may sometimes miss the turning points, but our objective is to pick up on the broad trends of outperformance or underperformance. We like banks in general but our preferences within the sector are constantly shifting.
By continually adjusting the portfolio and making trades such as this, we feel we end up owning attractive stocks. As a result, our turnover is quite high.
Since launch, our fund has outperformed the benchmark (after fees) by 2 percentage points per annum and other funds that invest in the UK stockmarket by almost 3 percentage points per annum8.
Outlook
We do not think the UK market offers particularly good value at present. Granted, the UK is cheaper than most other markets9 but after strong performance in 2025, it is not undervalued compared with its own history10.
By contrast, the average holding in our fund looks cheap relative to the profits it is generating11 and, as a result, I am more optimistic about our companies achieving their forecasts than about the market in general. We suspect the shares we own will do well because they have been delivering good news and this is not yet reflected in their share prices.
Notes and references
1 The FTSE All-Share index is a widely-used indicator of the performance of the UK stockmarket, in which the fund invests. It acts as a ‘comparator benchmark’ against which the fund’s performance can be compared. Management of the fund is not restricted by this benchmark.
2 The IA UK All Companies sector shows the average return from a group of other asset managers’ funds that invest in similar asset types as this fund, collated by the Investment Association. It acts as a ’comparator benchmark’ against which the fund’s performance can be compared. Management of the fund is not restricted by this benchmark.
3 & 4 Bloomberg
5 https://www.hsbc.com/investors/results-and-announcements
7 https://www.cityam.com/barclays-and-deutsche-most-at-risk-to-private-credit-profit-blow/
8 Artemis/Lipper Limited total return, July 2010 to 31 March 2026
9 & 10 Source: Goldman Sachs as at 28 March 2026
11 Artemis/LSEG Datastream
Risks specific to Artemis SmartGARP UK Equity Fund
- Market volatility risk The value of the fund and any income from it can fall or rise because of movements in stockmarkets, currencies and interest rates, each of which can move irrationally and be affected unpredictably by diverse factors, including political and economic events.
- Currency risk The fund’s assets may be priced in currencies other than the fund base currency. Changes in currency exchange rates can therefore affect the fund's value.
- Charges from capital risk Where charges are taken wholly or partly out of a fund's capital, distributable income may be increased at the expense of capital, which may constrain or erode capital growth.
Important information
The intention of Artemis’ ‘investment insights’ articles is to present objective news, information, data and guidance on finance topics drawn from a diverse collection of sources. Content is not intended to provide tax, legal, insurance or investment advice and should not be construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any security or investment by Artemis or any third-party. Potential investors should consider the need for independent financial advice. Any research or analysis has been procured by Artemis for its own use and may be acted on in that connection. The contents of articles are based on sources of information believed to be reliable; however, save to the extent required by applicable law or regulations, no guarantee, warranty or representation is given as to its accuracy or completeness. Any forward-looking statements are based on Artemis’ current opinions, expectations and projections. Articles are provided to you only incidentally, and any opinions expressed are subject to change without notice. The source for all data is Artemis, unless stated otherwise. The value of an investment, and any income from it, can fall as well as rise as a result of market and currency fluctuations and you may not get back the amount originally invested.
