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Although economic gloom is all over and President Trump is causing a rumpus with his 'America first' technique, the UK stock exchange remains unfazed.

Despite a few wobbles recently - and more to come as Trump rattles global cages - both the FTSE100 and wider FTSE All-Share indices have been durable.

Both are more than 13 per cent higher than this time in 2015 - and near to tape highs.

Against this background of economic uncertainty, Trump rhetoric and near-market highs, it's difficult to think that any outstanding UK financial investment opportunities for client financiers exist - so called 'recovery' situations, where there is potential for the share cost of specific business to increase like a phoenix from the ashes.

But a band of fund managers is specialising in this contrarian form of investing: purchasing undervalued companies in the expectation that in time the marketplace will reflect their true worth.

This undervaluation might result from bad management causing business mistakes; an unfriendly economic and financial backdrop; or wider issues in the industry in which they operate.

Rising like a phoenix: Buying underestimated companies in the hope that they'll ultimately skyrocket needs nerves of steel and limitless persistence

Yet, the fund managers who purchase these shares think the 'problems' are solvable, although it might use up to 5 years (periodically less) for the outcomes to be reflected in far greater share rates. Sometimes, to their dismay, the problems prove unsolvable.

Max King spent 30 years in the City as a financial investment manager with the likes of J O Hambro Capital Management and Investec. He says investing for recovery is high threat, needs patience, a disregard for agreement investment thinking - and nerves of steel.

He likewise believes it has actually ended up being crowded out by both the expansion in affordable passive funds which track specific stock market indices - and the appeal of growth investing, constructed around the success of the huge tech stocks in the US.

Yet he insists that recovery investing is far from dead.

Last year, King states various UK healing stocks made shareholders stunning returns - including banks NatWest and Barclays (still recovering from the 2008 global monetary crisis) and aerospace and defence huge Rolls-Royce Holdings (growing again after the effect of the 2020 pandemic lockdown). They produced respective returns for investors of 83, 74 and 90 per cent.

Some shares, states King, have more to provide financiers as they progress from healing to development. 'Recovery financiers frequently purchase too early,' he states, 'then they get tired and offer too early.'

But more importantly, he believes that new recovery opportunities constantly provide themselves, even in a rising stock market. For brave financiers who purchase shares in these healing situations, outstanding returns can lie at the end of the rainbow.

With that in mind, Wealth asked 4 leading fund managers to identify the most compelling UK healing opportunities.

They are Ian Lance, supervisor of financial investment trust Temple Bar and Alex Wright who runs fund Fidelity Special Situations and trust Fidelity Special Values. These two managers welcome the healing financial investment thesis 100 percent.

Completing the quartet are Laura Foll, who with James Henderson runs the financial investment portfolio of trust Law Debenture, and Imran Sattar of financial investment trust Edinburgh.

These 2 supervisors buy healing stocks when the financial investment case is engaging, but only as part of broader portfolios.

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' Recovery stocks remain in our DNA,' says Lance who runs the ₤ 800 million Temple Bar with Nick Purves. 'The logic is easy. A business makes a tactical error - for instance, a bad acquisition - and their share rate gets cratered. We purchase the shares and then wait for a catalyst - for example, a change in management or organization strategy - which will transform the business's fortunes.

' Part of this process is talking to the business. But as a financier, you must be patient.'

Recent success stories for Temple consist of Marks & Spencer which it has actually owned for the past five years and whose shares are up 44 per cent over the previous year, 91 percent over the past 5.

Fidelity's Wright states purchasing healing shares is what he provides for a living. 'We buy unloved business and then hold them while they ideally undergo positive modification,' he explains.

' Typically, any healing in the share rate takes in between 3 and 5 years to come through, although occasionally, as happened with insurer Direct Line, the healing can come quicker.'

In 2015, Direct Line's board accepted a takeover offer from rival Aviva, valuing its shares at ₤ 2.75. As an outcome, its shares rose more than 60 percent.

Foll says healing stocks 'are typically big motorists of portfolio performance'. The best UK ones, she states, are to be found among underperforming mid-cap stocks with a domestic company focus.

Sattar says Edinburgh's portfolio is 'varied' and 'all weather condition' with an emphasis on high-quality firms - it's awash with FTSE100 stocks.

So, healing stocks are just a slivver of its properties.

' For us to purchase a healing stock, it should be first and foremost an excellent business.'

So, here are our investment professionals' top choices. As Lance and Wright have said, they might take a while to make good returns - and nothing is ensured in investing, particularly if Labour continues to make a pig's ear of promoting economic development.

But your persistence could be well rewarded for accepting 'recovery' as part of your long-lasting financial investment portfolio.

> Look for the stocks below, most current performance, yield and more in This is Money's share centre

WINNERS IN A POSSIBLE HOME BUILDING BOOM Marshalls is the nation's leading provider of structure, landscaping, and roofing items - purchasing roof specialist Marley 3 years ago.

Yet it has actually had a hard time to grow income against the background of 'challenging markets' - last month it said its income had actually fallen ₤ 52million to ₤ 619 million in 2024.

The share price has actually gone no place, falling 10 and 25 percent over the previous one and 2 years.

Yet, lower rate of interest - a 0.25 per cent cut was revealed by the Ban > k of England last Thursday - and the meeting of a yearly housebuilding target of 300,000 set by Chancellor Rachel Reeves might help ignite Marshalls' share price.

Law Debenture's Foll states any pick-up in housebuilding ought to lead to a need rise for Marshalls' items, flowing through to greater earnings. 'Shareholders could delight in appealing overall returns,' she says, 'although it might take a while for them to come through.' Edinburgh's Sattar likewise likes Marshalls although, unlike Foll who already holds the company's shares in Law Debenture's portfolio, it is only on his 'radar'.

He states: 'Its sales volumes are still listed below pre-pandemic levels. If the Chancellor does her bit to re-

fire up housebuilding, then it should be a recipient as a provider of products to brand-new homes.'

Sattar likewise has an eye on Travis Perkins which he has owned in the past. 'It has fresh management on board [a new chairman and president] and I have a meeting with them soon,' he states.

' From a financial investment perspective, it's a choices and shovels approach to gaining from any expansion in the real estate market which I choose to purchasing shares in private housebuilders.'

Like Marshalls, Travis Perkins' shares have actually gone nowhere, falling by 7, 33 and 50 percent over one, two and three years.

Another recipient of a possible housebuilding boom is brick manufacturer Ibstock. 'The company has actually huge repaired expenses as a result of warming the big kilns required to make bricks,' states Foll.

' Any uptick in housebuilding will increase brick production and sales, having an exaggerated benefit on its operating expense.'

Lower interest rates, she adds, need to likewise be a positive for Ibstock. Although its shares are 14 per cent up over the previous year, they are up a meagre 0.3 percent over two years, and down 11 and 42 per cent over 3 and 5 years.

Fidelity's Wright has actually also been buying shares in 2 business which would gain from an improvement in the real estate market - kitchen area provider Howden Joinery Group and retailer DFS Furniture.

Both companies, he states, are gaining from struggling rivals. In Howden's case, rival Magnet has been closing display rooms, while DFS competitor SCS was purchased by Italy's Poltronesofa, which then closed numerous SCS stores for repair.

DFS, a Midas pick last month, has seen its share cost rise by 17 percent over the past year, but is still down 41 per cent over 3 years. Howden, a constituent of the FTSE 100, has made gains of 6 percent over both one and three years.

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FUND MANAGER WORTH MORE THAN ITS PARTS Temple Bar's Lance does not mince his words when discussing FTSE250-listed fund manager Abdrn. 'People are right when they explain it as a rather having a hard time fund management business,' he states.

'Yet what they frequently don't understand is that it likewise owns an effective financial investment platform in Interactive Investor and an advisor company that, combined, validate its market capitalisation. In result, the market is putting little worth on its fund management organization. '

Include a pension fund surplus, a huge multi-million-pound stake in insurance company Phoenix - and Lance states shares in Abrdn have 'great recovery capacity'.

Temple Bar took a stake in business at the tail end of last year. Lance is enthused by the business's brand-new management team which is intent on trimming expenses.

Over the previous one and 3 years, the shares are down 3 and 34 percent, respectively.

OTHER RECOVERY POSSIBILITIES Fidelity's Wright states a recovery stock tends to go through three unique phases.

First, a company embarks on positive modification (phase one, when the shares are dirt low-cost). Then, the stock exchange recognises that modification remains in development (stage 2, shown by a rising share rate), and lastly the cost totally shows the changes made (phase three - and time to think about offering).

Among those shares he holds in the phase one container (the most amazing from a financier viewpoint) is advertising huge WPP. Wright bought WPP last year for Special Values and Special Situations.

Over one, two and three years, its shares are respectively up by 1 per cent and down by 22 and 33 per cent.

'WPP's shares are low-cost since of the hard marketing backdrop and concerns over the possible disruptive impact of expert system (AI) on its incomes,' he states. 'But our analysis, based in part on talking with WPP clients, shows that AI will not disrupt its organization model.'

Other recovery stocks pointed out by our experts consist of engineering huge Spirax Group. Its shares are down 21 per cent over the past year, but Edinburgh's Sattar states it is a 'dazzling UK commercial company, global in reach'.

He is also a fan of pest control huge Rentokil Initial which has actually experienced duplicated 'missteps' over its pricey 2022 acquisition of US business Terminix.

Sattar holds both stocks in the ₤ 1.1 billion trust.