For financial professionals in the UK

Fund Manager October 2021 Commentary – Henderson European Focus Trust

16 Nov 2021

At the time of writing, the world economy is facing the stiff challenge presented by what could be termed a ‘shortage of everything’. In the energy sector, a supply shortage has been exacerbated by the ‘gold rush’ known as Environmental, Social and Governance (ESG) investing. Politicians, protesters, and investors are seemingly uniting to ‘cancel’ certain corporates and/or industries. This, in turn, has led to something of a starvation of capital committed to the likes of oil exploration and carbon energy infrastructure. We are now faced with the harsh realities of such cancellation as the world is brought to a shuddering reality: that the energy transition will take time and it cannot be rushed. As unfashionable as that view may seem, it is also unfashionable, to some, to hold oil stocks in investment portfolios. Here we see opportunity: to invest in seriously undervalued stocks and, via engagement, to demonstrate that those companies are part of the solution.

Our portfolio activity in the month of October broadly continued the prior month’s direction of travel, whereby we topped up some holdings in selected names in the “value” sectors of autos, banks, and energy.

Environmental, Social and Governance (ESG) Expand

Environmental, social and governance are three key criteria used to evaluate a company’s ethical impact and sustainable practices.

Value stocks Expand

Value investors search for companies that they believe are undervalued by the market, and therefore expect their share price to increase. One of the favoured techniques is to buy companies with low price to earnings (P/E) ratios. 

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. References made to individual securities do not constitute a recommendation to buy, sell or hold any security, investment strategy or market sector, and should not be assumed to be profitable. Janus Henderson Investors, its affiliated advisor, or its employees, may have a position in the securities mentioned.


Past performance does not predict future returns. 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.


Marketing Communication.






Important information

Please read the following important information regarding funds related to this article.

Before investing in an investment trust referred to in this document, you should satisfy yourself as to its suitability and the risks involved, you may wish to consult a financial adviser. This is a marketing communication. Please refer to the AIFMD Disclosure document and Annual Report of the AIF before making any final investment decisions.
    Specific risks
  • If a Company's portfolio is concentrated towards a particular country or geographical region, the investment carries greater risk than a portfolio that is diversified across more countries.
  • The Company may have a particularly concentrated portfolio (low number of holdings) relative to its investment universe - an adverse event impacting only a small number of holdings can create significant volatility or losses for the Company.
  • Where the Company invests in assets that are denominated in currencies other than the base currency, the currency exchange rate movements may cause the value of investments to fall as well as rise.
  • This Company is suitable to be used as one component of several within a diversified investment portfolio. Investors should consider carefully the proportion of their portfolio invested in this Company.
  • Active management techniques that have worked well in normal market conditions could prove ineffective or negative for performance at other times.
  • The Company could lose money if a counterparty with which it trades becomes unwilling or unable to meet its obligations to the Company.
  • Shares can lose value rapidly, and typically involve higher risks than bonds or money market instruments. The value of your investment may fall as a result.
  • The return on your investment is directly related to the prevailing market price of the Company's shares, which will trade at a varying discount (or premium) relative to the value of the underlying assets of the Company. As a result, losses (or gains) may be higher or lower than those of the Company's assets.
  • The Company may use gearing (borrowing to invest) as part of its investment strategy. If the Company utilises its ability to gear, the profits and losses incurred by the Company can be greater than those of a Company that does not use gearing.