Investec European A

European equity fund based around Investec's 4Factor quantitative process.

  • 0.00p Price (Inc)
  • - Price (Acc)
  • 4.50% 0.00% Initial charge
  • 1.50% Annual management charge
  • 1.61% Ongoing charges
  • 0.00% Yield

Fund data last updated 23 September 2009

The fund aims to achieve long term capital growth primarily through investment in equities issued by companies in the Continental Europe region. This European equity fund is run on a purely bottom-up basis, using a combination of quantitative analysis based on Investec's 4 Factor model and more detailed qualitative research. Investec brought the fund in house in January 2007 but the managers have failed to add value since then.

Fund summary

Sector Europe Excluding UK
Structure X-OEIC
Launched September, 1986
Size £28m
Yield 0.00%
Charging basis Income
Dividends paid Acc units only

Charges

Standard initial charge 4.50%
Initial charge via Bestinvest 0.00%
Additional bid/offer spread 0.00%
Annual management charge 1.50%
Ongoing charges figure 1.61%

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Investment process

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.

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.

Manager research

Average monthly relative returns

  • 14/15 0.38%
  • 15/16 -0.28%
  • 16/17 -0.08%
  • 17/18 0.16%
  • 18/19 -0.13%

Bestinvest MRI

  • 3 years -0.02%
  • 5 years 0.01%
  • Career 0.09%
  • 3 years 50.00%
  • 5 years 50.00%
  • Career 84.90%

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

Ken Hsia

Hsia joined Investec in 2004 where he is currently responsible for their European Equity strategy and also provides research support on the industrials sector for the 4Factor UK Equity team. Hsia also managed the UK Alpha/Aggressive strategy from June 2006 to April 2012. Prior to joining Investec, Hsia co-founded MoVa Investment Partners, a hedge fund where he was involved in managing a portfolio focused on European small and mid-cap stocks. Prior to that, he spent 8 years at Fidelity Investments as an equity analyst covering a range of sectors, including UK and European Auto components, Construction, Non-food Retail and Utilities. Hsia graduated from New College, Oxford, with a DPhil in Organic Chemistry. He is also an associate member of UKSIP.

Track record

Ken Hsia has 7.5 years experience of managing mutual funds in this sector. Over this period the average monthly return relative to the benchmark index has been +0.09%. During the worst period of relative performance (from June 2008 - November 2011) there was a decline of 15% relative to the index. The worst absolute loss has been 40%. Statistically, we estimate the probability that this fund manager is adding value, rather than being lucky, is 85%.

Periods of worst performance

Absolute -40.00% (May 2007 - February 2009)
Relative -15.00% (June 2008 - November 2011)

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.

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Top 10 holdings

Data accurate as at 30 November 2012

5.3% Novartis Ag
4.6% Sanofi
4% Teleperformance
3.6% Total S.a
3.6% Bayer Ag
3.4% Reed Elsevier Nv
3% Sap Ag
2.9% Ing Groep N.v.
2.8% Heidelbergcement Ag
2.6% Unilever Nv
Source: Trustnet

Sector breakdown

Consumer Goods 28.00%
Services 18.00%
Financials 14.00%
Industrials 12.00%
Resources 12.00%
Technology 10.00%
Utilities 3.00%
Money Market 3.00%

Portfolio

50-70 holdings. Few stocks in the portfolio will have a market cap below EUR 1bn.

Constraints

Stocks +/- 3.5%; Sectors +/- 8%; sub sectors +/- 5%. Maximum 10% emerging markets.

Key Investor Information

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