Bestinvest says
This fund lost its way when it was outsourced to Blackrock and was subsequently brought in house in January 2007. Whilst performance has picked up more recently, investors have experienced an extended period of relative underperformance and we believe there are better opportunities within the European sector. In light of this we suggest investors consider our other rated funds including Schroder European Alpha Plus, Threadneedle European Select or Blackrock European Dynamic.
Investec believe the following drive share prices: strategy, valuation, dynamics and technicals. As such, the fund's investment strategy is based on this premise, utilising Investec's 4Factor systematic process which identifies stocks related to the above four factors. Strategy targets companies that generate shareholder value (high returns on capital); Valuation aims to identify companies trading at a discount relative to their fundamental economic prospects based on a discounted cash flow model; Dynamics favours prefers companies that are seeing upward revisions to expectations for profitability and Technicals selects companies whose share prices are already in established up-trends. The initial screen is used to reduce the fund's universe to 120-150 high scoring stocks which are then subjected to more detailed qualitative analysis. The fund is run by the 4Factor global equity team, who split research into 6 super-sectors on a global basis. Portfolio construction is the sole responsibility of the named manager. Country positions are a result of the bottom-up stock picking process and are monitored but not constrained - the team believe sector constraints are a more effective way of managing risk.