Fund Manager September 2021 Commentary – Henderson European Focus Trust
4 minute read
John Bennett, Portfolio Manager of Henderson European Focus Trust, provides an update on the Trust highlighting factors affecting the European market and areas where he is finding opportunities.
At the time of writing the world economy is facing the stiff challenge presented by what could be termed "a shortage of everything". If we dwell on energy, here is a sector where supply shortage has been exacerbated by the gold rush known as 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 has to take time; it cannot be rushed.
As unfashionable as that view may seem, it is also unfashionable, to some, to hold oil stocks in investor portfolios. Here we see opportunity: the opportunity to invest in seriously undervalued stocks and, via engagement, to demonstrate that those companies are part of the solution. In recent weeks, therefore, we have increased our exposure to the oil sector.
We also believe that the "shape" of the market has thrown up further opportunity, one that can be described as the style discrepancy. With "growth" stocks once again in the ascendancy over the summer months, a number of "value" names have been left in the wake. Thus, we have added selectively to exposure in the autos and banking sectors.
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 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.
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