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At a glance
Index
FTSE World Europe Ex UK
Launch date
Sep 1993
Fund size
£548.6m
Fund currency
GBP
OEICs
Fund Managers
Nick Davis
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European Fund
Threadneedle European Fund has a strong track record of both relative and absolute returns since it launched and offers investors a simple, focused and pragmatic way to access the performance potential of European Equities. Managed by Nick Davis, the Fund is a portfolio of typically 50-70 European stocks selected on a bottom up basis to build a portfolio of explicit and defined investment risk.
Graph as at 12 noon: 31st March 2012
Key selling points
- A simple, focused, pragmatic approach.
- The Fund is managed to generate a portfolio of explicit, disciplined risk with clear investment parameters.
- Well resourced investment team - William is supported by 22-strong team of UK and continental European portfolio managers who operate within Threadneedle's wider team of more than 120 investment professionals.
- Comprehensive European equity range - differing objectives and risk profiles, from core funds to more concentrated high alpha and specialised smaller company funds, our range of European equity funds provide options for investors with differing risk appetites.
Why invest in European equities?
- The global economy is in recovery mode, allowing European companies in a range of industries to benefit from improving demand.
- Having cut costs aggressively during the downturn, many companies are now feeling the benefit of operational gearing into the recovery.
- The market is trading at an attractive valuation relative to history and to other assets such as bonds.
- Corporate results have generally been better than expected.
- Cash flows are healthy and balance sheets are strong, yet cash balances are earning little. This suggests that earnings enhancing M&A activity is likely to be a feature.
- The divergence between the strong and the weak countries will increase but some of the prosperity from stronger countries such as Germany, with an increasingly robust GDP from well balanced expansion, will trickle down to the other countries.
Ratings logos
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| Fund manager | Nick Davis |
| Launch Date | September 1985 |
| Index | FTSE World Europe ex UK |
| IMA Sector | Europe ex UK |
| Annual management charge | 1.50% |
| Minimum investment | Initial: £2,000 Subsequent: £1,000 |
| Fund codes | |
| ISIN | GB0001440949 |
| Sedol | 144094 |
| MEDIX | ESEUA |
Communication is key
Idea generation
A clear understanding of the macroeconomic and thematic background is a vital starting point for building the portfolio. These insights are gained from numerous sources including Threadneedles's regular economic outlook meeting and investment themes meeting where a culture of challenge and debate ensures only the best ideas make it into a portfolio. Views from external economists and strategists help highlight those areas of the market likely to be a good source of stock opportunities. These top-down inputs serve to educate and guide what is predominantly a bottom-up, stock-picking process.
Stock analysis
This top-down approach is combined with over 300 company meetings where we can understand how a business may develop over the medium-term. The manager uses a variety of analysis to assess the stocks including valuation tools and financial analysis to ensure he targets quality companies with robust balance sheets and pricing power achieved through strong market positioning.
Portfolio construction and risk management
Once the stock ideas have been thoroughly debated the fund manager is responsible for constructing a balanced portfolio, aware of the need to generate alpha from different directions balancing one stock with another.
The portfolio is then monitored constantly by an independent risk team - a process aided by daily risk reports - to ensure that it is structured correctly and that any risks are known, are directionally desirable and are managed.
The rigor that underpins the process allows the team to invest with real conviction.
- Nick Davis
Nick Davis joined Threadneedle in 2010. He is the fund manager for Threadneedle European Fund and Threadneedle Pan European Equity Dividend Fund and has analytical responsibility for the Pharmaceuticals, Insurance and Beverages sectors.
Prior to joining Threadneedle, Nick worked as a sell-side analyst at Sanford Bernstein. He has additional experience as a Chartered Accountant at Deloitte.
Nick graduated from Durham University in 2004 with a BA (Hons) in Economics with French and also studied at the University of Aix-Marseille.
Fund Profile
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Fund Factsheet
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European Equity Range Brochure
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Fund Application Form
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ISA Transfer Pack
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ISA Application Form
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