INVESTMENT STRATEGY
REGIONAL SECTORS
EUROPE
trustnet.com
PROFILE: HENDERSON EUROPEAN FOCUS TRUST
John Bennett joined Henderson from Gartmore and took over this trust from the
departing Roger Guy. He has proved himself a worthy successor to Guy – the trust
is up by close to 140 per cent over three years, comfortably the highest gain in the
sector.
Bennett is a conviction-driven investor, happy to back his judgement
with significant sector and stock positions. He invests with an eye on the
macroeconomic and sector environment, believing these trends travel globally,
and that understanding global market and industry dynamics can provide early
insights into the prospects for European companies.
He has more of a value style, looking to take advantage of structural market
inefficiencies by correctly anticipating market and industry change. Current
significant themes in the portfolio include healthcare, with Novartis and Fresenius
major holdings. Bennett also has a “smart cars” theme, via holdings in companies
such as Autoliv and Valeo.
heard of. The second wave may
look beyond these companies.”
He believes managers such as
Henderson’s John Bennett should
benefit from this environment.
“When they started to come back
to the market, they tended to
buy the biggest companies first.
The weight of money goes into
the companies that everyone has
PERFORMANCE OF TRUST
VS SECTOR AND INDEX OVER 3YRS
140%
TSE World Europe ex UK TR in GB (70.17%)
Henderson - Henderson European Focus Trust Ord 50P TR in GE (138.52%)
IT Europe TR in GB (98.19%)
120%
100%
80%
60%
40%
20%
0%
Apr
Feb 15
Dec
Oct
Aug
Jun
Apr
Feb 14
Dec
Oct
Aug
Jun
Apr
Feb 13
Dec
Oct
Aug
20%
Jun 12
IT HAS BEEN A STRONG 12
MONTHS FOR THE EUROPEAN
SECTOR, buoyed by quantitative
easing and some lessening of
political fears for the eurozone.
International asset allocators have
been lured back as economic data
has improved and the average
trust has risen 11.1 per cent over
one year and 104.7 per cent over
three.
Nevertheless, this masks some
divergence in performance for
individual trusts. Peters says:
“There is real diversity of style
in the Europe sector. On the
one hand there are good growth
managers, such as Alexander
Darwall at Jupiter. On the other,
there are some very good value
managers such as John Bennett at
Henderson. While the long-term
numbers from Jupiter are way
ahead of the peers, shorter-term
the picture is more nuanced.”
Of those hugging the bottom
of the performance table, Peters
says that the BlackRock Greater
Europe fund has a solid manager
in Vince Devlin, but his style is
more index-plus and this has
seen the trust skewed to some
out-of-favour areas. He says that
the European Investment Trust
has been disappointing, with its
value approach not delivering as
expected. This is partly due to the
market’s preference for companies
with certainty of earnings.
Peters says that he has generally
found managers less buoyant
this year than last. “Last year,
they were really excited, but this
year, they seem to believe that
valuations are pretty full,” he
added. “Earnings are OK, but they
are worried on the weak euro.”
Moore believes that there may
be a change of leadership in
European funds from here. “For
years, US investors had stayed
away from Europe,” he said.
Source: FE Analytics
19