Barings Europe Select A

  • 4411.00p
    Price (Inc)

    These are the shares in the fund that pay out an income to clients. The income is made up of the total dividends – the money a company can pay out to its investors – from the companies in the fund.

  • -
    Price (Acc)

    These are the shares in the fund that don’t pay out an income to clients. Any dividends – the money a company can pay out to its investors – are reinvested into companies in the fund. Despite no income, the shares should be worth more over time. Good incentive, eh?

  • 5.00% 0.00%

    Initial charge

    Some funds charge you when you first invest, which is aptly known as the initial charge. They’re usually between 3-5% but at Bestinvest, we usually don’t charge you a penny!

  • 1.50%
    Annual management charge

    This is how much the fund management company charges to run the fund. It’s like paying a babysitter, dog sitter or house sitter (that makes well-informed, heavily researched changes to improve your baby/dog/house when needed).

  • 1.55%
    Ongoing charges

    This stands for Ongoing Charges Figure. It’s the cost of running a fund and includes admin fees, manager fees, administration costs, etc.

  • 0.60%
    Yield

    How much the fund is currently paying out in income to investors. It’s NOT to be confused with the overall growth of a fund – a very different thing indeed. It’s also NOT a guarantee of future pay-outs, just a snapshot. This is more what it’s not than what it is…

Prices as at 23 October 2020, fund data last updated 26 August 2020

The fund targets long-term capital growth by investing in a portfolio of continental European small and mid-cap companies. Manager Nicholas Williams and his team seek to do this in a relatively low risk way, and to this end focus on quality companies, have a large number of stocks (around 100) and a higher weighting to mid-cap companies than many peers. They have a GARP style (Growth At a Reasonable Price) which focuses on identifying companies with superior growth characteristics which are not fully reflected in the share price.

Fund summary

Sector European Smaller Companies
Structure UNIT TRUST
Launched
Size £1,396m
Yield 0.60%
Charging basis Income
Dividends paid 30 Apr, 31 Oct

Charges

Standard initial charge 5.00%
Initial charge via Bestinvest 0.00%
Annual management charge 1.50%
Ongoing charges figure 1.55%

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Investment process

Barings' investment style as a group is quality GARP. The company believes that long-term earnings growth drives stock market performance, and that favouring quality companies gives the best chance of finding unrecognised growth. The fund’s investable universe is continental European companies with a market value of less than €5bn – this amounts to around 5,000 companies. Ideas are sourced from company meetings, quantitative screens, and from other teams at Barings. Companies are researched and scored on a scale of 1-5 based on: - Quality. Well-established business franchises, competent management aligned with shareholders, and strong balance sheets - Growth. Net earnings growth over the last three years, the next 12 months and the next five years. - Valuation. Calculated using next 12 months' PE, a static valuation based on PB, and a proprietary valuation based on five years earnings. The manager constructs the portfolio from the analysts' highest rated ideas (those scoring 1 or 2), focusing on those with a catalyst for outperformance over the next 9-12 months, with a 40% target upside. Williams likes to run a circa 100 stock portfolio – this allows him to maintain liquidity so he can move quickly, and means no one stock’s return can dominate performance. Price targets and stop losses are set for each stock and reviewed when reached.

Nicholas Williams has worked in the investment industry for more than 30 years, including a long and successful stint running European small-cap funds. As well as beating the index fairly consistently his defensive performance profile, which includes typically lower volatility than the benchmark and a degree of protection from falling markets, shows that his risk-averse approach is paying off. Given the large number of stocks it is key that he has adequate resources, and he benefits from the input of three co-managers and a dedicated analyst and also sources ideas from other Barings teams. This backup and Williams' experience give us confidence that the fund's success can be maintained.

Manager research

Average monthly relative returns

  • 15/16 0.00%
  • 16/17 0.00%
  • 17/18 0.00%
  • 18/19 0.00%
  • 19/20 0.00%

Bestinvest MRI

  • 3 years 0.00%
  • 5 years 0.00%
  • Career 0.00%
  • 3 years 0.00%
  • 5 years 0.00%
  • Career 0.00%

Performance figures are based on the average of monthly percentage returns relative to the benchmark index.

Track record

Periods of worst performance

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Relative 0.00% ()

About the MRI

Our unique indicator: the Bestinvest Manager Record Index (MRI) measures the likelihood that the fund manager is adding value through their decisions. It is based on their performance record over the course of their career, adjusted for the amount of risk taken. MRI is an important contributor to our fund rating system but it is also vital to take account of qualitative factors. It is also very important to select funds to form a cohesive portfolio with an appropriate overall risk level.

Allocation

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Sector breakdown

Financials 21.00%
Business Services 18.00%
Consumer Goods 17.00%
Industrials 16.00%
Technology 10.00%
Basic Materials 9.00%
Money Market 6.00%
Retail 3.00%
Resources 1.00%

Portfolio

80-110 stocks with position sizes between 0.5% and 3%. Position sizing based on a combination of conviction and liquidity.

Key Investor Information

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