Trust TV: Is now the time to invest in Europe?
In this latest episode of Trust TV, we speak to Tom O’Hara, Portfolio Manager of Henderson European Focus Trust – to discuss how he is steering the Trust through a challenging market environment, areas where he is finding opportunities, and the risk of a recession and its impact of global markets. Tom also looks at how the war in Ukraine has affected the ESG narrative.
- We have circa 18% exposure to the energy sector, and we have been refining our exposure within the consumer mass market space as the cost-of-living crisis intensifies. We are style agnostic - so we have been investing in a blend of growth and value stocks.
- Due to higher input costs (raw materials, wages, and energy) and lower consumer spending, businesses within the European industrials and consumer discretionary sectors have been experiencing higher margin pressure.
- ESG is partially responsible for the distortion in the capital allocation process both within equity markets and corporations. It’s not our job to cancel businesses – we prefer to work with companies to ensure that they are travelling in the right direction whilst aligning shareholder and societal interests.
Please read the following important information regarding funds related to this article.
- If a trust's portfolio is concentrated towards a particular country or geographical region, the investment carries greater risk than a portfolio diversified across more countries.
- The trust may have a particularly concentrated portfolio (low number of holdings) relative to its investment universe and an adverse event impacting only a small number of holdings can create significant volatility or losses for the trust.
- Where the trust invests in assets which are denominated in currencies other than the base currency then currency exchange rate movements may cause the value of investments to fall as well as rise.
- This trust is suitable to be used as one component in several in a diversified investment portfolio. Investors should consider carefully the proportion of their portfolio invested into this trust.
- Active management techniques that have worked well in normal market conditions could prove ineffective or detrimental at other times.
- The trust could lose money if a counterparty with which it trades becomes unwilling or unable to meet its obligations to the trust.
- 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 trust’s shares, which will trade at a varying discount (or premium) relative to the value of the underlying assets of the trust. As a result losses (or gains) may be higher or lower than those of the trust’s assets.
- The trust may use gearing as part of its investment strategy. If the trust utilises its ability to gear, the profits and losses incured by the trust can be greater than those of a trust that does not use gearing.