Europe can be overlooked by investors, but following encouraging economic data, significant fiscal expansion and a slew of companies beating earnings expectations, its stock market - as measured by MSCI Europe ex UK Index - has beaten all other major regions so far this year.
In this interview, Jamie Ross, manager of Henderson Eurotrust (HNE) tells Mary McDougall why he continues to back defensive, quality growth companies, despite the recent rally in more cyclical names. He explains where he thinks valuations look stretched, what he has been buying and selling recently and why sustainability-minded investors should pay attention to management incentive structures.
He also shares why he feels more positive now than he has in the past about Europe’s perennial problem: How will it cope with rising debt levels?
Henderson Eurotrust’s share price (total return) has risen 25 per cent over the past 12 months - in line with its benchmark index. Over five years, the trust has delivered returns of 109 per cent, compared with 82 per cent for the FTSE Europe ex UK Index.
On 30 June, the trust - which had assets of £352m - was trading at a discount to net asset value of 11 per cent.