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Hardman & Co Monthly: January 2018

Feature Articles:
ONS survey underlines importance of the retail investor:
The latest Office for National Statistics (ONS) survey, ‘Ownership of UK quoted shares: 2016’, shows that retail investors are more important than most company managements realise or most capital markets professionals admit. When it is also appreciated that the data shows that retail investors set the share price for most quoted companies, most days, it becomes clear that engaging with such an audience enhances a company’s standing, whilst ignoring them courts disaster.
â–º Individuals form the largest component of share registers by value after the Rest of the World for every size of company from AIM to FTSE 100;
â–º Of all investors, individuals have the highest propensity to hold non-FTSE 100 shares;
â–º Recent years have seen a reversal in the long post-war decline of the retail investor;
► 82% of AIM companies have an average trade size of less that £10,000.

Hardman Healthcare Index:
The Hardman Healthcare Index has been running since 2009. Its main function is to highlight the attractions of life sciences investments over the long term. 2017 was another successful year for the index, rising 20.3% to 437.3, and outperforming the London Allshare index, but trailing the performance of the AIM market. Since inauguration, the compound annual growth rate has been 20.5%, compared with 5.4% for the Allshare Index and 6.1% for the AIM Index.
â–º Of the 54 companies included in the Hardman index, 31 saw their share prices rise in 2017, whereas 23 fell, with no company simply marking time;
► The variance between the best- and worst-performing stocks was high, at 301% – Immupharma (IMM) rising 227% and Vernalis (VER) falling 74% – the median share price change was +9%;
â–º In relative terms, only 20 stocks outperformed the index over the last year, with the other 34 underperforming.