Artemis sees value in Europe
Artemis Investment Management - European Opportunities Fund
Type: Unit trust
Aim: Growth by investing in European equities excluding the UK
Minimum investment: Lump sum £1,000, monthly £50
Investment split: At least 80% in European equities excluding the UK, up to 20% in derivatives and fixed interest securities
Charges: Initial 5.25%, annual 1.5%
Commission: Initial 3%, renewal 0.5%
Tel: 08700 092 2090
Artemis has launched its 14th unit trust, the Artemis European opportunities fund. The fund aims for growth by investing in a portfolio of 50 to 70 European equities excluding the UK, but can invest in fixed interest and derivatives where appropriate.
Hargreaves Lansdown fund analyst Richard Troue says: “It might seem difficult to be positive on Europe with the on-going wrangling over sovereign debt in the peripheral nations, but investors write off European companies at their peril.
“Europe is home to 130 of the world’s largest 500 companies. Following the recent bout of stock market volatility, many European companies look excellent value.”
Troue believes that further stock market falls cannot be ruled out, but times of distress can turn out to be a good long-term buying opportunity for the brave. “We might look back in 10 years’ time and reflect on what an opportune time this was to launch a European fund. Mark Page and Laurent Millet, who recently launched the Artemis European opportunities fund, will certainly be hoping so.”
Trouepoints out that both managers joined Artemis from LV= earlier this year. He adds that they had both carved a successful track record managing the LV= European excluding the UK Growth Fund.
“At the heart of the portfolio will be 40-50 core holdings. These will be companies which Mark Page and Laurent Millet feel are “masters of their own destiny” and will include world-class industry leaders, companies with quality franchises that are growing profitably, and those with little or no debt.
“They cite brewing giant AB InBevas an example. The company has grown profitably over the past five years and has carved out market-leading positions in the US and Brazil. Its portfolio of brands includes Becks, Stella Artois and Hoegaarden; found in virtually every UK bar.”
Troueobserves that in addition to the core holdings, Page and Millet will have a further 10-20 opportunistic or thematic holdings. “These could be companies offering attractive levels of income, or capitalising on opportunities in faster growing central and eastern European markets, such as Turkey and Poland, for example. Their approach seems sensible and I like the idea of combining core positions with higher octane and thematic plays in a concentrated portfolio,” says Troue.
Turning to the potential drawbacks of the fund Troue says: “Running money at Artemis will undoubtedly be different to the environment Page and Millet experienced at LV= and it is one in which I would expect them to do well. However, I would like to observe the fund for a while, seeing how the pair settle in and how effective their processes prove to be.”
Troue says that investors are not short of options when considering competitor European funds. He would give serious consideration to the Henderson European special situations fund, managed by Richard Pease. “Pease also runs a concentrated portfolio of around 60 stocks and, like Page and Millet, he can also take advantage of opportunities among smaller and medium-sized companies. “
Suitability to market: Good
Investment strategy: Good
Adviser remuneration: Average