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James Inglis-Jones, Cashflow Solution: The opportunities in Europe

We believe that the outlook for the Cashflow Solution process is improving, not only due to the development of more supportive investment conditions, but because we have also recently been able to enhance our investment process. Equity valuations currently look stretched, implying that further sentiment-driven rallies in markets are unlikely, but a lack of evidence of excessive capital spending and balance sheet growth from European corporates also suggests that a correction is not due either. This balanced set of circumstances, if it plays out, is one which we believe would suit our investment process. We invest in companies generating high cash returns on equity, a strategy which we know tends to perform less well (on a relative basis) in sentiment-driven rallies, but can be very rewarding when markets become focused on shorter term earnings delivery – as they seem to be currently – rather than the indiscriminate re-rating of stocks.

John Husselbee, Multi-Manager: ‘Pedalling’ short-term performance

Last weekend was one for sports fans with the Wimbledon finals, World Cup quarter finals, British Grand Prix and of course, Le Grand Depart of the world's best known bike race, the Tour de France. Putting aside the chaos caused by road closures in the North and South of England, the staging of the opening was by all accounts a real success. Spectators flocked in their thousands to line the streets to catch a brief glimpse of the peloton, many of them hoping that a British rider will win the overall race for the third year in a row.

 

Le Tour, now in its 101st year, is a test of speed and endurance for the world's best riders on the flat as well as over hills and mountains. They will ride 3,664km in 21 stages from Leeds to the finish on Champs Élysées in late July. So who will be wearing the prized yellow jersey in Paris? Well it won't necessarily be the rider who wins the most stages.

Disclaimer

Any opinions expressed should not be construed as advice for investment in any [product or] security mentioned or which may form the underlying content of any topics discussed in this blog.  The information and opinions provided in this blog take no account of the investors’ individual circumstances and should not be taken as specific advice on the merits of any investment decision.   Any opinions or information provided has been based on sources we believe to be reliable at the time of this blog’s preparation: no representation or warranty, express or implied, is made as to the accuracy, reliability or completeness of such information.  Neither Liontrust, nor any of its partners, employees, representatives or agents accepts any liability whatsoever for any direct or consequential loss howsoever arising, directly or indirectly, from any use of our research or its contents.

Liontrust, its partners and/or employees may have had, have or will have positions in the securities (or related financial instruments) which are those referred to, or those underlying the content discussed in this blog.

Any individual who chooses to invest in any securities should do so with caution. Investing in securities is speculative and carries a high degree of risk; you may lose some or all of the money that is invested.  Always research your own investments and consult with a regulated investment advisor or licensed stock broker before investing.

Shares in companies referred to may be relatively illiquid and hard to trade, therefore riskier than other investments and there could be a large bid/offer spread, so if you need to sell soon after you’ve bought, you might get less back than you paid. This can make them riskier than other investments.