Europe has remained fixed in the focus of fund managers since the onset of the sovereign debt crisis, and the past 12 months have been no easy ride.
Looking back to June 2014, the launch of the T-LTRO programme was seen as the first step to put the beleaguered region on a firmer footing, with full-blown QE following in January of this year.
But what bearing has this had on fund manager performance and who, if anyone, has made the most of the move to an ultra-accommodative stance on the continent?
Citywire Global has taken a closer look at the 107 fund managers currently active in the Equity – Europe ex UK sector to uncover who has shown the strongest uptick over the past 12 months.
This analysis compared the fund managers ranking position over the 12 months from May 2013 to May 2014 with where they now sit in their peer group based on the performance to the end of May 2015.
Here we count down the top three fund managers and manager teams showing the greatest improvement over this timeframe.
Samuel Morse, Fidelity
Fund: Fidelity European A Acc
- Ranking period one (May 2013-May 2014): 97/105
- Ranking period two (May 2014-May2015): 14/107
Kicking off the countdown is Samuel Morse, who has run the UK-domiciled Fidelity European Fund since December 2009. The fund is registered for sale in five European markets in total and operates with a bias towards small- and mid-cap companies.
Morse focuses largely on the eurozone, with 55% allocated here and the bulk of the remainder in Europe ex eurozone, which accounts for 36% of the portfolio. The top two positions are in Swiss blue chip companies Nestlé (5.6%) and Roche (5.5%), while financial services the biggest sector bet.
Over the 12 months to end of May 2015, Morse returned 25.6% in euro terms which compares to an average manager return of 20.6%. This outperformance also outpaced the index, the FTSE World Europe ex UK TR EUR, rose 18.5%. This saw Morse rise 83 places up the rankings.
Niall Gallagher, GAM
- Ranking period one (May 2013-May 2014): 99/105
- Ranking period two (May 2014-May2015): 10/107
Also making huge strides up the rankings is GAM’s Niall Gallagher, who is now in the top 10 performers in the sector on a 12-month basis. Over this timeframe, he returned 26.5%, which is 5.86 percentage points above the average peer.
In the £460 million (€646 million) Dublin-domiciled fund, which Gallagher has run since December 2009, the emphasis is on industrials, where the fund has almost double the benchmark exposure. This accounts for 24.5% of the fund, while consumer discretionary is also well-represented at 24.1%.
On a country basis, Gallagher has kept with core Europe as his main investment area, holding 19.3% in German-listed companies, while having 17.2% exposed to France and 15.4% invested in Switzerland. As with Morse, Roche features as a prominent stock bet and is the top holding.
Matthias Born & Thorsten Winkelmann, Allianz GI
- Ranking period one (May 2013-May 2014): 103/105
- Ranking period two (May 2014-May2015): 5/107
Showing the strongest improvement in performance is the highly-rated Allianz Global Investors duo of Matthias Born and Thorsten Winkelmann. The pair, who mainly run all Europe equity strategies, have co-run the Allianz Continental Europe fund since succeeding Neil Dwane in October 2010.
In a similar vein to Morse, the pair invest heavily in the eurozone, which accounts for around two-thirds of the regional exposure. However, the duo have technology listed as their biggest single sector exposure, which makes up 21.7% of total investment.
The pair underperform both the average manager and the index on a two-year basis but have produced stellar returns on a one-year basis. In the year to the end of May 2015, Born and Winkelmann returned 29.2% and achieved the fifth strongest return over this timeframe.