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Home > Top Stories > CONSENSUS CHALLENGED BY THE PUBLICATION OF ‘THE FUTURE IS SMALL’

CONSENSUS CHALLENGED BY THE PUBLICATION OF ‘THE FUTURE IS SMALL’

Published by Gbaf News

Posted on November 14, 2014

3 min read

Last updated: January 22, 2026

FiS

The Future is Small is a new book that raises pertinent questions about the future of investing, beginning with the current stagnation of world economies – despite trillions of dollars of support being injected into the global financial system. It anticipates that the global economy will remain moribund for decades irrespective of record low interest rates remaining in place, and governments running higher budget deficits for longer than originally planned.

FiS The collective problem lies in the fact that during the period of globalisation most institutional investors progressively reduced their interest in genuinely small stocks to almost nothing. Larger stocks grew perfectly well during the credit boom, and they also had the advantages of major scale and plentiful market liquidity too. The Future is Small explains why equity portfolios lacking smallness are now inappropriate following the change in economic trend.

Rather than an academic, The Future is Small is unusual as it is written by a full-time professional fund manager. Gervais Williams was awarded ‘Investor of the Year’ at Grant Thornton’s Quoted Company Awards in 2009 and 2010, and this year he became What Investment’s ‘Fund Manager of the Year’ too. Miton Group plc, where he is Managing Director, was also announced as What Investment’s ‘Best Fund Group’ this year too.

Gervais Williams says of his book: “The Future is Small contends that we are at the early stages of a multi-decade period of small companies’ outperformance – a new super-cycle of returns from the smallest quoted stocks. The inconvenient truth is that without decent world growth, there are now few mainstream market indices that have attractive prospects.”

Fundamentally, Gervais believes that it is the greater growth potential of genuinely small companies that explains why many can buck a tough economic trend, whereas larger companies with major market positions are trapped by their flat sales lines. Published by Harriman House, The Future is Small explains why the smallest quoted companies, those listed on the AIM exchange, will be the best performing over the coming decades.

Luke Johnson, Chairman, Risk Capital Partners, said: “This book makes a very straightforward proposition: AIM stocks should do well in the years ahead. I happen to agree with this theory, because it closely mirrors my own views and philosophy on investing, which have been arrived at during my 30-odd years in business. As a consequence, I heartily recommend this volume to any reader who is willing to decide for themselves how to deploy their savings.”

The small company effect: £1 invested in 1955 would have – by 2013 – grown to1:

£1,070 – invested in the DMS All-Equity Index
£4,907 – invested in the Numis Smaller Companies Index (NSCI)
£21,585 – invested in the DMS MicroCap Index
£61,233 – invested in the ‘Small Value’ part of the NSCI

CONSENSUS CHALLENGED BY THE PUBLICATION OF ‘THE FUTURE IS SMALL’ Returns including capital gains with dividend income reinvested. Source: Dimson, E. and Marsh, P. Numis Smaller Companies Annual Review 2014.

Gervais Williams adds: “If portfolio allocations are a measure of the maturity of a trend, then independently minded market participants can take great comfort from the fact that very few portfolios have anything like a full weighting in genuinely small companies. Indeed very few UK ‘Smaller Companies’ funds have a decent weighting of genuinely small companies. Portfolio weightings in stocks listed on the AIM market are probably even more under-represented.”

To request a copy of The Future is Small, please contact Francesca.Webb@mitongroup.com or Leeya.Balmforth@citigatedr.co.uk with your details, including postal address. For a free e-book, please visit www.harriman-house.com/titles/review/?code=futureissmall14