Essentials: the Janus Henderson Global Property Equities Strategy

12/07/2017

Download


Guy Barnard, Co-Head of Global Property Equities, provides an introduction to the Global Property Equities Strategy. The high conviction, actively-managed strategy invests in listed property stocks and real estate investment trusts (REITs), and aims to deliver attractive total returns to investors over the long term.
 
What does the strategy offer to investors?
The strategy offers investors an opportunity to benefit from the attractive characteristics of global property, namely a real asset with a high and growing income yield.  It does this through investing in listed property companies which we feel offer a liquid, diversified and low cost way of accessing the property market.  Our investment universe has grown significantly in recent years, through the growth of the tax efficient REIT regime, and as a result we now have more than 500 companies globally which we would consider investing in, and a free float market cap of those companies in excess of $1 trillion.  So the REIT regime really has been a tremendous success that is providing attractive, tax efficient returns for investors, and for us as active managers it is creating a deep pool of opportunities which we can look to exploit.
 
What does the strategy invest in?
Our strategy focuses on bottom up stock selection to be the key driver of alpha.  We feel as investors you should really place as much emphasis on the area where you think you can add consistent value over the medium and long term, and that for us is really bottom up stock selection, given our focus on understanding property markets and understanding the management teams of the companies in which we can invest.
 
Describe the investment approach 
We benefit from a truly global team. We are a team of eight dedicated investment professionals.  We only invest in the property sector.  It is all that we do.  And we have a team that is based in each of the regions in which we invest.  So we have investment professionals in London covering Europe, Singapore covering Asia Pacific, and Chicago covering the North American markets.  The result we feel is a team that is able to identify the best bottom up stock opportunities from around the world and really look to bring those together into one highly concentrated, high conviction portfolios which is going to generate the best returns for clients over the medium and long term.
 
How is the investment team structured? 
As active managers, we believe it is important to do just that, i.e. be active, so when we are constructing our portfolios we are looking to put together a concentrated, high conviction portfolio with a high gross active share.  We feel that means that the best ideas that we have globally are going to have a meaningful impact on the overall fund performance.  So typically you will see us holding 50 to 60 names in a global fund with a gross active share, so a measure of that bottom up stock risk, of typically around 70%.  We feel that’s different from peers, we are very comfortable being different.  Doesn’t always mean we sleep comfortably, given the high conviction we are taking, but we do it because we believe it’s going to generate the best returns for investors over the long term.
 
What makes the strategy unique? 
We understand that investors have a wide range of investment choices today in terms of asset classes and products, and for us we really advocate real estate forming part of a balanced portfolio.  The inclusion of real estate will typically enhance the risk return characteristics of a portfolio, so investors will get a higher return for the same level of risk.
 
What are the benefits of including property equities in a portfolio? 
I think combining the attractiveness of the asset class with our approach as active managers, which we really see as only becoming increasingly important given some of the structural trends that are playing out in markets globally, we think should warrant inclusion in many investors’ portfolios.

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.

For promotional purposes.

Anything non-factual in nature is an opinion of the author(s), and opinions are meant as an illustration of broader themes, are not an indication of trading intent, and are subject to change at any time due to changes in market or economic conditions. It is not intended to indicate or imply that any illustration/example mentioned is now or was ever held in any portfolio. No forecasts can be guaranteed and there is no guarantee that the information supplied is complete or timely, nor are there any warranties with regard to the results obtained from its us.


Important information

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

Janus Henderson Horizon Asia-Pacific Property Equities Fund

Specific risks

  • 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 Fund could lose money if a counterparty with which it trades becomes unwilling or unable to meet its obligations to the Fund.
  • Changes in currency exchange rates may cause the value of your investment and any income from it to rise or fall.
  • If the Fund or a specific share class of the Fund seeks to reduce risks (such as exchange rate movements), the measures designed to do so may be ineffective, unavailable or detrimental.
  • The Fund's value may fall where it has concentrated exposure to a particular industry that is heavily affected by an adverse event.
  • Any security could become hard to value or to sell at a desired time and price, increasing the risk of investment losses.
  • The Fund may invest in real estate investment trusts which can involve different risks to investing directly in the underlying assets. Such schemes may increase risk due to factors such as restrictions on withdrawals and less strict regulation. The value of your investment may fall as a result.

Risk rating

Janus Henderson Horizon Global Property Equities Fund

Specific risks

  • 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 Fund could lose money if a counterparty with which it trades becomes unwilling or unable to meet its obligations to the Fund.
  • Changes in currency exchange rates may cause the value of your investment and any income from it to rise or fall.
  • If the Fund or a specific share class of the Fund seeks to reduce risks (such as exchange rate movements), the measures designed to do so may be ineffective, unavailable or detrimental.
  • The Fund's value may fall where it has concentrated exposure to a particular industry that is heavily affected by an adverse event.
  • Any security could become hard to value or to sell at a desired time and price, increasing the risk of investment losses.
  • The Fund may invest in real estate investment trusts which can involve different risks to investing directly in the underlying assets. Such schemes may increase risk due to factors such as restrictions on withdrawals and less strict regulation. The value of your investment may fall as a result.

Risk rating

Janus Henderson Horizon Pan European Property Equities Fund

Specific risks

  • 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 Fund could lose money if a counterparty with which it trades becomes unwilling or unable to meet its obligations to the Fund.
  • Changes in currency exchange rates may cause the value of your investment and any income from it to rise or fall.
  • If the Fund or a specific share class of the Fund seeks to reduce risks (such as exchange rate movements), the measures designed to do so may be ineffective, unavailable or detrimental.
  • The Fund's value may fall where it has concentrated exposure to a particular industry that is heavily affected by an adverse event.
  • Any security could become hard to value or to sell at a desired time and price, increasing the risk of investment losses.
  • The Fund may invest in real estate investment trusts which can involve different risks to investing directly in the underlying assets. Such schemes may increase risk due to factors such as restrictions on withdrawals and less strict regulation. The value of your investment may fall as a result.

Risk rating

Share

Important message