Insight from our equity teams to help clients navigate the markets and opportunities ahead.


Making sense of the new ‘normal’ (Oct 2020)

Making sense of the new ‘normal’ (Oct 2020)
By Alex Crooke, Co-Head of Equities – EMEA & Asia Pacific

Key takeaways

  • Janus Henderson has broad expertise across equities globally. Our teams are able to develop their own approaches and views on markets; the quarterly Equity Perspectives shares some of this thinking.
  • In this second edition, we examine the question of what the new ‘normal’ will be from a US, Technology, Real Estate, European and Value equities perspectives.
  • While many uncertainties remain, economies continue to receive central bank and government support and many companies are finding new ways to operate and benefit as social and working environments change.

Video summary

At the time of recording we have seen the number of COVID-19 cases rising recently in many markets. Healthcare systems, however, seem to be coping and investors are hoping for vaccines to help cure or at least stop the spread of the virus. We also continue to see central bank and government support for economies.

As we look forward, equity markets are pricing in a recovery into 2021. Importantly, companies that we are meeting and companies that we invest in are beginning to tell us that they are finding ways of coping with the partial or full lockdowns still in place, and are finding ways of getting their products to market.

Market-leading technology

Since the pandemic took hold, the best area of the equity market has undoubtedly been growth investing, particularly the technology sectors. The US market being dominated by some very large technology companies has been one of the standout regions to invest in. It is apparent that some of these technology companies have been great beneficiaries of lockdown and the new ways of working, from conference calling, home working and home shopping. As a result, we have seen very strong revenue beats – actual company data beating analysts’ forecasts – coming from the technology sector, supporting strong share price performance.

Challenging environment for dividends

More challenged areas of the equity market include those companies that pay dividends. Given the ongoing uncertainty, a lot of companies have been retaining capital to support their businesses, and that has come at the cost of dividend payments. However, we are now seeing a more supportive backdrop. Some of those companies that stopped paying dividends, particularly in the UK and Europe, have indicated that they are going to recommence in the final months of 2020 or next year. In my view, we are probably past the worst for equity income investors, but it is still very challenging finding growth from an income point of view in the equity market.

Uncertainties remain

There are still meaningful uncertainties. We have got the US presidential election in November, while Prime Minister Abe in Japan unexpectedly resigned, and so new leadership is required there. In Europe, Brexit needs to be finalised by the end of this year; a process that will also no doubt continue to serve up uncertainty. In addition, we remain wary about what the winter in the northern hemisphere will mean for cases of COVID-19.

Opportunities for active equity investors

When we examine what companies are doing to manage the impact of the pandemic and the support that governments and central banks have given, we still consider it an interesting market in which to find good investments for our clients. In my opinion, the key for the future is maintaining an active approach to investing, keeping close to the companies we invest in and being prepared to hold the right companies for the long-term benefit of our clients. We hope you enjoy this quarter’s equity perspectives and as always welcome any feedback or would be happy to discuss our views in more depth.



These are the views of the author at the time of publication and may differ from the views of other individuals/teams at Janus Henderson Investors. Any securities, funds, sectors and indices mentioned within this article do not constitute or form part of any offer or solicitation to buy or sell them.

Past performance is not a guide to future performance. The value of an investment and the income from it can fall as well as rise and you may not get back the amount originally invested.

The information in this article does not qualify as an investment recommendation.

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Insights from our Global Teams

Insights from our Global Teams

Director of Research Matt Peron says that while the 2020 U.S. presidential race could create volatility for stocks, such pullbacks are often based on fear, not long-term fundamentals.

Portfolio Manager Denny Fish argues that a long view is essential for maximising the opportunity presented by the forces driving the transition to a digital global economy.

Global real estate Portfolio Managers Guy Barnard, Tim Gibson and Greg Kuhl address misperceptions investors may have about real estate post-COVID-19 and explain why the team believes it remains an attractive and relevant asset class.

US equities Portfolio Manager Nick Schommer discusses the importance of durable, competitively advantaged business models amid a disrupted economic environment.

John Bennett, Director of European Equities, explains the potential turning point in markets that could propel European equities to compete with the long-running and seemingly invincible US bull market.

Portfolio Manager Justin Tugman discusses factors that may point to a leadership change from growth to value stocks. He also explores the potential a defensive value-based approach offers investors concerned with ongoing market volatility and lofty stock valuations.

Our Capabilities

Our Equity Capabilities

Janus Henderson provides an active approach to equity investing. The equities platform is shaped by the belief that fundamental research is the foundation for delivering long-term, market-leading risk-adjusted returns. Independent thought and unique viewpoints are central to this approach and result in portfolios that are meaningfully different to an index. Each team expresses their individual, high-conviction ideas through processes that have evolved to suit their specific areas of the market and within robust risk control frameworks.

While operating with independence, the equities teams benefit from collaboration and shared research that provide a source of portfolio ideas. The culture encourages intellectual challenge and stimulating debate to test – and ultimately strengthen – investment thinking. The success of ideas is measured by overall client outcomes with the aim to deliver consistent, long-term risk-adjusted excess returns over benchmarks and peers regardless of the investment landscape. This effort is supported by award-winning, proprietary portfolio construction technology and a cultural emphasis on the client promise.

The equity teams, led by Co-Heads of Equities Alex Crooke and George Maris, include 165 investment professionals, responsible for US$171.1bn in assets under management[1]. The teams include those with a global perspective, those with a regional focus – US, Europe, Asia Pacific and Emerging Markets – and those invested in specialist sectors. A range of growth, value and absolute return styles are employed.

Equities Org Chart

[1] Source: Janus Henderson, as at 30 June 2020.
Fundamental research: The analysis of information that contributes to the valuation of a security, such as a company’s earnings or the evaluation of its management team, as well as wider economic factors. This contrasts with technical analysis, which is centred on idiosyncrasies within financial markets, such as detecting seasonal patterns.