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Dave Dudding and his familiar global names – Threadneedle European Select

Interested in investing in Europe, a region where we believe opportunities exist for investors? The Threadneedle European Select fund, run by Dave Dudding, could be a good option.

Lee Dooley Lee Dooley
25 March 2015

We view the European Central Bank’s Quantitative Easing programme as a positive for equity markets. This programme is likely to boost European economic growth in 2015, especially when combined with a sharp fall in oil prices, and as a consequence, should be positive for European equities.

Dave Dudding has a strong track record and looks for companies with a sustainable competitive advantage. Once he finds them, he holds on to them until he considers that their investment case has materially changed. Dudding is a stockpicker, focusing on absolute, rather than relative performance, and this approach has proven particularly robust in difficult market conditions.

Victoria Chernykh, our sector specialist, comments: “Dudding focuses on companies where earnings growth is consistently followed by dividend growth, with the aim of finding businesses that grow dividends at a rate exceeding inflation”. Consumer goods, healthcare and basic material companies often fit this profile and comprise a sizeable portion of the portfolio – Bayer, the pharmaceutical company that discovered aspirin, sits at the top of the fund’s top-10 holdings. Dudding definitely thinks L’Oreal ‘is worth it’ as the company makes up 5.6% of the fund’s portfolio, and he also holds Anheuser-Busch Inbev, the multinational brewer of Budweiser, Stella Artois and Oranjeboom.

More recently, with Dudding expecting the euro to remain weak against the US dollar and a number of other major currencies, Victoria says that he “favours export companies that are set to benefit from continuing euro weakness rather than companies with a domestic focus.” Threadneedle European Select therefore provides exposure to stable and leading large companies in Europe and has a portfolio that is diversified across sectors and geographies.

 

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The value of investments, and the income derived, can go down as well as up, and you can get back less than you originally invested. Different funds carry varying levels of risk depending on the geographical region and industry sector in which they invest. You should make yourself aware of these specific risks prior to investing. This article does not constitute personal advice.