The Fund’s A3 share class returned 7.0%* in euro terms in November. This Fund’s target benchmark, the MSCI Europe Small Cap Index, returned 9.0%.
Global markets performed strongly in November as investors bet on a ‘Goldilocks’ scenario whereby cumulative policy tightening brings inflation under control without triggering a recession. Although interest rate cuts are now being priced in, the minutes of the European Central Bank’s last meeting suggested it remains vigilant to upside inflation risks. Eurozone inflation for November was also lower than expected, giving support to European stocks.
Sector returns for the MSCI Europe Index were largely positive in November with the exception of energy (-1.3%). The real estate (+14%), information technology (+14%) and industrials (+11%) sectors led the way with double-digit returns for the period.
Danish jewellery manufacturer and retailer Pandora (+15%) had another strong month, building on its impressive performance over the year to date. In its Q3 update, the company noted an acceleration in organic growth to 11%, while upgrading its growth guidance for the full year to +5% to +6%, previously +2% to +5%. Pandora stated that increased investments into the brand, as part of the next phase of its Phoenix strategy, is showing strong signs and driving greater consumer engagement.
Norwegian Air (+25%) was also among the top performers over the month following the release of strong third quarter results. The European carrier reported higher-than-expected profits for the period of NOK 2.17 billion versus NOK 1.03 billion in the same period last year. Looking forward, the company stated that booking momentum for the fourth quarter was encouraging and predicted low single-digit percentage capacity growth.
Swedish cloud-based accounting software company Fortnox (+31%) bounced back strongly in November following a tough October as positive market sentiment drove the performance of a number of our holdings.
French wholesale electrical distributor Rexel (+15%), steel wire transformation and coating technologies company Bekaert (+12%) and UK-based online real estate property portal Rightmove (+16%) were also among the portfolio companies to benefit from the uptick in investor confidence.
London-based direct marketer of promotional merchandise company 4imprint (-14%) was among the few detractors for the Fund over the month. While its trading update raised guidance on pretax profit for the year, its shares fell on comments that it has recently seen some weaker demand patterns indicative of a more cautious economic environment.
Positive contributors to performance included:
Pandora (+16%), Rexel (+15%), Bekaert (+12%), Fortnox (+31%), Serco Group (+11%)
Negative contributors to performance included:
4imprint (-14%), Ringkøbing Landbobank (-1.0%)
Discrete years' performance (%) to previous quarter-end:
|
|
Sep-23 |
Sep-22 |
Sep-21 |
Sep-20 |
Sep-19 |
|
Liontrust GF European Smaller Companies A3 Acc EUR |
14.2% |
-20.7% |
59.1% |
-1.9% |
-6.7% |
|
MSCI Europe Small Cap |
14.0% |
-26.9% |
38.0% |
0.2% |
-1.8% |
|
|
Sep-18 |
|
Liontrust GF European Smaller Companies A3 Acc EUR |
2.0% |
|
MSCI Europe Small Cap |
3.4% |
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.
Overseas investments may carry a higher currency risk. They are valued by reference to their local currency which may move up or down when compared to the currency of the Fund. This Fund may have a concentrated portfolio, i.e. hold a limited number of investments. If one of these investments falls in value this can have a greater impact on the Fund's value than if it held a larger number of investments. As the Fund is primarily exposed to smaller companies there may be liquidity constraints from time to time, i.e. in certain circumstances, the fund may not be able to sell a position for full value or at all in the short term. This may affect performance and could cause the fund to defer or suspend redemptions of its shares. In addition the spread between the price you buy and sell units will reflect the less liquid nature of the underlying holdings. Outside of normal conditions, the Fund may hold higher levels of cash which may be deposited with several credit counterparties (e.g. international banks). A credit risk arises should one or more of these counterparties be unable to return the deposited cash. Counterparty Risk: any derivative contract, including FX hedging, may be at risk if the counterparty fails.
DISCLAIMER
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.
