The Fund’s A4 share class returned 1.3%* in euro terms in February. The Fund’s comparator benchmarks, the MSCI Europe Index and HFRX Equity Hedge EUR Index, returned 1.8% and -1.5% respectively.
At the start of the month, the European Central Bank (ECB) confirmed expectations of a 50 basis point interest rate rise, taking the key rate to 2.5%. Following the rise, ECB president Christine Lagarde re-confirmed the Bank’s intention to “stay the course in increasing interest rates significantly, at a steady pace”, Lagarde continued with unusually firm language, explicitly stating its intention to hike rates by another 50 basis points in March.
In terms of sector returns for the period, the European market was led by communication services (+4.3%), financials (+3.6%) and industrials (+3.1%) in sterling terms. While real estate (-3.0%), healthcare (-1.1%), IT (-0.8%) were among the laggards.
During a busy earnings period, Pandora (+18%) was among the top risers in the Fund’s long book over the month as the Danish jewellery manufacturer and retailer posted Q4 sales of DKK9.9 billion beating analysts’ expectations. Q4 organic growth was 4% year on year and 19% when compared to the pre-pandemic Q4 in 2019.
Rexel (+16%), the French company specialising in the distribution of electrical, heating, lighting and plumbing equipment, noted strong performance over 2022, performing above the upgraded guidance it released in Q3. Most notably, sales for the year were up 14% from the previous, driven by accelerating electrification trends in Europe.
Other notable performers in our long book were Bank of Ireland (+6.6%), Norwegian technology company Kongsberg Gruppen (+7.9%), Italian bank UniCredit (+8.2%), British multinational defence, justice & immigration, transport, health, and citizen services company Serco (+7.7%) and British multinational communications firm WPP (+9.3%).
Among the short book highlights were a German multinational online food-delivery service and a Swedish laboratory and automation and life sciences company, with both firms share prices falling following the release of lacklustre earnings reports.
Among the long book‘s detractors, the heaviest faller was Indivior (-21%) as shares fell sharply mid-month after the group revealed it had put aside $290m for ongoing litigation in the US, with the company stating the money was intended to cover "multidistrict antitrust class and state claims". In terms of its earnings release, Indivior posted a 14% increase in full-year revenues to $901m, with fourth-quarter revenues rising 9% to $241m.
Discrete years' performance** (%), to previous quarter-end:
Past performance does not predict future returns
|
Dec-22 |
Dec-21 |
Dec-20 |
Dec-19 |
Dec-18 |
|
|
Liontrust GF European Strategic |
18.3% |
32.9% |
-10.0% |
23.2% |
-7.1% |
|
MSCI Europe |
-9.5% |
25.1% |
-3.3% |
26.0% |
-10.6% |
|
HFRX Equity Hedge EUR |
-5.2% |
11.0% |
2.9% |
8.5% |
-12.3% |
*Source: Financial Express, as at 28.02.23, total return (income reinvested and net of fees).
**Source: Financial Express, as at 31.12.22, total return (income reinvested and net of fees). Discrete data is not available for ten full 12-month periods due to the launch date of the portfolio (25.04.14). Investment decisions should not be based on short-term performance.
A performance fee of 20% is calculated and accrued at each valuation point. Payment is subject to the Fund's net asset value exceeding an Adjusted Prior Net Asset Value which is a High Water Mark adjusted by any new subscriptions or redemptions and a 4% hurdle per calendar year. No Performance Fee will be payable with respect to a Fund class in any Performance Period unless such class has recovered any accumulated underperformance for previous Performance Periods. Any performance fees are only payable on the positive difference between the NAV and the Adjusted Prior Net Asset Value. Details of the Fund's performance fee in the last financial year can be found in the Key Investor Information Document (KIID) which can be obtained free of charge from the Liontrust website.
Key Features of the Liontrust GF European Strategic Equity Fund
KEY RISKS
Past performance is not a guide to future performance. The value of an investment and the income generated from it can fall as well as rise and is not guaranteed. You may get back less than you originally invested.
The issue of units/shares in Liontrust Funds may be subject to an initial charge, which will have an impact on the realisable value of the investment, particularly in the short term. Investments should always be considered as long term.
Investment in Funds managed by the Cashflow Solution team involves foreign currencies and may be subject to fluctuations in value due to movements in exchange rates. Some of the Funds may invest in derivatives. The use of derivatives may create leverage or gearing. A relatively small movement in the value of a derivative's underlying investment may have a larger impact, positive or negative, on the value of a fund than if the underlying investment was held instead. Some of the funds may hold a concentrated portfolio of stocks. If the price of one of these stocks should move significantly, this may have a notable effect on the value of the respective portfolio.
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This is a marketing communication. Before making an investment, you should read the relevant Prospectus and the Key Investor Information Document (KIID), which provide full product details including investment charges and risks. These documents can be obtained, free of charge, from www.liontrust.co.uk or direct from Liontrust. Always research your own investments. If you are not a professional investor please consult a regulated financial adviser regarding the suitability of such an investment for you and your personal circumstances.
This should not be construed as advice for investment in any product or security mentioned, an offer to buy or sell units/shares of Funds mentioned, or a solicitation to purchase securities in any company or investment product. Examples of stocks are provided for general information only to demonstrate our investment philosophy. The investment being promoted is for units in a fund, not directly in the underlying assets. It contains information and analysis that is believed to be accurate at the time of publication, but is subject to change without notice. Whilst care has been taken in compiling the content of this document, no representation or warranty, express or implied, is made by Liontrust as to its accuracy or completeness, including for external sources (which may have been used) which have not been verified. It should not be copied, forwarded, reproduced, divulged or otherwise distributed in any form whether by way of fax, email, oral or otherwise, in whole or in part without the express and prior written consent of Liontrust.
