In this 'Essentials' video, John Bennett, Head of European Equities, provides an overview of his long / short* European equities strategy. His style-agnostic approach focusses on cash-flow and valuation, and aims to generate a positive absolute return over the long term, whatever the market backdrop.
*Long / short: A fund which can invest in both 'long' and 'short' positions (see glossary below). The intention is to profit from gains in 'long' positions, and price declines in 'short' positions. This type of investment strategy can generate returns irrespective of moves in the wider market.
Long position: A position which is bought with the expectation of a rise in value.
Short position: A position on a stock that allows a profit to be made if the value of that stock falls, although a loss will be made if the value rises.
Net and gross exposure: The exposure level of a fund to the market. Net exposure is calculated as the sum of a fund's 'long' positions minus its 'short' positions. Gross exposure is calculated as the sum of a fund's 'long' positions plus its 'short' positions.