Jpmam europe dynamic fund range citywire_oct13
Upcoming SlideShare
Loading in...5
×
 

Jpmam europe dynamic fund range citywire_oct13

on

  • 738 views

 

Statistics

Views

Total Views
738
Views on SlideShare
523
Embed Views
215

Actions

Likes
0
Downloads
5
Comments
0

5 Embeds 215

http://www.citywire.co.uk 150
http://citywire.co.uk 47
http://shakespeare.cw-london.co.uk 8
http://shakespeare 6
http://m.citywire.co.uk 4

Accessibility

Upload Details

Uploaded via as Adobe PDF

Usage Rights

© All Rights Reserved

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Processing…
Post Comment
Edit your comment

Jpmam europe dynamic fund range citywire_oct13 Jpmam europe dynamic fund range citywire_oct13 Presentation Transcript

  • FOR PROFESSIONAL CLIENTS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION J.P. Morgan Asset Management European Equities JPMorgan Dynamic Funds Citywire Wealth Manager Retreat October 2013
  • European equities have more than doubled since March 2009 Performance of MSCI Europe Index 240 2nd Greek bailout €109bn + concerns on Spain & Italy €78bn bailout for Portugal 220 132%* 200 180 Draghi‘s bumblebee speech 160 ESM set up with €500bn 140 120 100 2009 EU tells France, Spain Ireland & Greece to cut Budget deficits 2010 IMF agree €110bn bailout for Greece 1st LTRO in December 2011 2nd LTRO in February 2012 2011 2012 Source: Datastream. Data from March 2009 to 1 October 2013. Includes reinvested dividends, in EUR. Past performance is not an indication of future. 1 2013
  • European equities are not driven by domestic economic growth Real GDP growth versus real equity returns (1970-2011) 6.0% 5.0% Denmark Real equity returns (%) 4.0% Switzerland 3.0% 2.0% Germany UK 1.0% Canada USA France** Australia Belgium 0.0% Austria -1.0% Italy*** -2.0% -3.0% 1.0% Norway Netherlands Japan 1.5% Spain* 2.0% 2.5% 3.0% 3.5% Real GDP growth (%) Source: SG Cross Asset Management. Thomson Datastream, OECD, MSCI Barra (first published in May 2010 – “Is there a link between GDP Growth & Equity Returns”). Equity returns from MSCI from 1970 – 2011 and GDP data from the OECD, * from 1980, ** from 1971, *** from 1984. 2
  • Closing the gap suggests $100bn of net inflows to European Equities 200 200  cumulative net inflows ($bn) EM 150 150 100 100 US 50 50 Japan $100bn -100 -50 Europe -50 -100  cumulative net outflows ($bn) -150 07 08 09 10 -150 11 Source: EPFR, SG Cross Asset Research/ Global Asset Allocation. Data as at September 2011. 3 12 13 14
  • Current valuations point to healthy returns 5.0% 30% 4.5% 25% 4.0% 20% 15% 3.0% 10% 2.5% 5% 2.0% 0% 1.5% -5% 1.0% European Dividend Yield, (%, LHS) 0.5% -10% MSCI Europe returns over the next 5 years (% p.a, RHS) 0.0% -15% 80 82 84 86 88 90 92 94 96 98 Year 00 02 04 06 08 10 12 Source: MSCI, SG Cross Asset Research. European Dividend Yield is the Cyclically Adjusted Dividend Yield for MSCI Europe factoring in the 10 year average. Data as at 30 June 2013. Past performance is not a guide to future performance. 4 Return Dividend yield 3.5%
  • Fund overview: JPM Europe Dynamic (ex-UK) Fund Management team Annualised Performance, Net of A Class Fees (1.5%) Excess return vs. FTSE AWD Europe ex UK Net Index 6% 5.5% 5% 3.9% 4% 3.0% 3% Jon Ingram John Baker Blake Crawford 2.0% 2%  Part of a team of 43 European equity investment professionals 1% Portfolio Characteristics   Benchmark:  Market capitalisation:  Fund size  Number of holdings  Expected alpha:  Expected tracking error: 0% Investment process: A best ideas approach focusing on stocks with attractive style characteristics 1 year 3 years (p.a) 5 years (p.a) Since inception (p.a.) FTSE AWD Europe ex UK Net Index Fund (%) multi-cap 35.0 Benchmark (%) 27.9 £107m 11.0 9.6 11.8 6.9 7.4 8.6 Rank quartile 8%+ p.a 1st 1st 1st 3.9 7.0 6.7 6.1 Inf Ratio 5% 1st TE (%) 91 1.4 0.6 0.3 0.5 Portfolio Managers as at 30 September 2013. There can be no assurance that the professionals currently employed by J.P. Morgan Asset Management will continue to be employed by J.P. Morgan Asset Management or that the past performance or success of any such professional serves as an indicator of such professional's future performance or success. Fund size as at 8 October 2013. * Past performance is not an indication of future performance. Figures in GBP, net of A class fees vs. FTSE AWD Europe ex UK, to 30 September 2013. Peer quartile is vs. the IMA Europe ex UK universe as at 27 September 2013 Excess return calculated geometrically. Inception date 30 September 2004. 5
  • Strong performance across Dynamic range Excess Returns vs relevant benchmark as at 30 September 2013 (%) 1 year 3 years 5 years Since Inception Fund return (%) 31.4 12.3 11.6 8.3 Benchmark (%) 18.9 10.1 10.7 4.6 Fund return (%) 35 11 9.6 11.8 Benchmark (%) 27.9 6.9 7.4 8.6 Fund return (%) 36.5 11.4 9.8 6.8 Benchmark (%) 23.9 7.7 8.1 3.1 Fund return (%) 35.3 - - 25.3 Benchmark (%) 28.6 - - 18.7 JPM UK Dynamic 10.5 12 8 4 2.8 2.0 3.6 0.8 0 6 mnths 1 year JPM Europe Dynamic (ex-UK) 6 3 years (pa) 5 years (pa) Since Inception (pa) 5.5 3.9 3.6 3.0 2.0 2 -2 6 mnths 1 year 3 years (pa) 5 years (pa) Since inception (pa) JPM Europe Dynamic 10.2 12 8 4 3.5 3.4 3.6 1.6 0 6 mnths 1 year 3 years (pa) 5 years (pa) Since inception (pa) JPMorgan Funds- Euroland Dynamic 8 3 5.5 5.2 1.6 n/a n/a -2 6 mnths 1 year 3 years (pa) 5 years (pa) Since inception (pa) Source J.P. Morgan Asset Management . Performance in GBP relates to the A-Net (acc) share class, NAV to NAV. JPM UK Dynamic Fund vs. FTSE All Share. Inception date Oct 2000. JPM Europe Dynamic (ex-UK) vs. FTSE All World Developed Europe from Oct 2008, prior to this FTSE Europe ex UK. Inception date 30 Sept 2004. JPM Europe Dynamic vs. MSCI Europe. Inception date Dec 2008. JPM Euroland Dynamic vs. MSCI EMU Index. Inception date Sept 2011. Past performance is not a guide to future performance. Please refer to the Fund's prospectus for more information relating to the Fund. 6
  • What do we believe? Attractively valued, high quality stocks with positive momentum outperform the market Quality ... our investment philosophy 7
  • BMW 90  Valuations remain attractive versus global peers 85  Positive news flow following International Motor Show in Frankfurt  Strong product pipeline – X5, X4, 4er, 3er GT, new Mini and Compact Active Tourer, i3, i8  Further upside potential from electromobility given current valuation of US based Tesla 80 75 70 65 60 55 50 Sep-12 Dec-12 Mar-13 Jun-13 Sep-13 Source: J.P. Morgan Asset Management, Bloomberg as at 08/10/13 The inclusion of the securities mentioned above is not to be interpreted as recommendations to buy or sell. These investment examples are included solely to illustrate the investment process and strategies which may be utilized by the Fund. Please note that these investments are not necessarily representative of future investments that the Fund will make. 8
  • Azimut holdings  One of the few independent asset gatherers in Italy  Focus on retail customers looking for capital preservation - Italy has a large pool (Euro3.5trn) of private financial wealth  20 Positive monthly net fund inflows since Q3 2011 18 16 14 12 10 8 Sep-12 Dec-12 Mar-13 Jun-13 Sep-13 Source: J.P. Morgan Asset Management, Bloomberg as at 08/10/13 The inclusion of the securities mentioned above is not to be interpreted as recommendations to buy or sell. These investment examples are included solely to illustrate the investment process and strategies which may be utilized by the Fund. Please note that these investments are not necessarily representative of future investments that the Fund will make. 9
  • PostNL  Regulatory support to improve profitability (increased stamp prices, abolition of Monday delivery, reduction in post box numbers)  Parcel and international divisions remain growth areas  4 Despite positive outlook valuations remain attractive 3 – – 2 1 Jan-13 Mar-13 May-13 Jul-13 p/e 8.8x 2013 p/e 7.2x 2014 Sep-13 Source: J.P. Morgan Asset Management, Bloomberg as at 08/10/13 The inclusion of the securities mentioned above is not to be interpreted as recommendations to buy or sell. These investment examples are included solely to illustrate the investment process and strategies which may be utilized by the Fund. Please note that these investments are not necessarily representative of future investments that the Fund will make. 10
  • Portfolio positioning – largest stock actives JPM Europe Dynamic (ex UK) Fund – as at 30 September 2013 Stock Active position % Absolute position % Auriga Industries 2.9 PostNL 2.7 DFDS 2.2 Smurfit Kappa 2.0 NATIXIS 1.8 BASF -- Siemens -- Sanofi -- Novartis -- Nestle -- -4.0% -3.0% -2.0% -1.0% 0.0% 1.0% 2.0% 3.0% 4.0% Source: J.P. Morgan Asset Management, Factset. Figures exclude cash. The companies/securities above are shown for illustrative purposes only. Their inclusion should not be interpreted as a recommendation to buy or sell. 11
  • Fund positioning JPM Europe Dynamic Fund (ex UK) – as at 30 September 2013 Active sector positions Active country positions Industrial Transportation Denmark Automobiles & Parts Ireland Aerospace & Defense Norway Nonlife Insurance Netherlands Life Insurance United Kingdom Industrial Engineering Italy Beverages Germany Food Producers Belgium Personal Goods France Pharmaceuticals & Biotech. Switzerland -6.0% -3.0% 0.0% 3.0% 6.0% 9.0% -10.0% -5.0% 0.0% 5.0% 10.0% Source: J.P. Morgan Asset Management, Factset. Allocations are made at the managers discretion and can be changed without notice. The holdings represent the current holdings of the fund. However, it cannot be assumed that these types of investments will be available to or will be selected by the fund in the future. 12
  • Conclusion  Current market environment is favourable for unconstrained, conviction based active management  Process is at its strongest as macro influences subside and fundamentals return as the key driver of markets  Despite continued strong performance, Europe and UK markets remain attractively valued  Well resourced, experienced team with strong track record of outperformance 13
  • Appendix 14
  • Specialist investment teams with an average of 14 years experience Michael Barakos (CIO) Core Style Investment Research & Portfolio Implementation Dynamic Small / Mid Cap Stephen Macklow- Smith Michael Barakos Nicholas Horne Jon Ingram Jim Campbell William Meadon Martin Hudson Callum Abbot Tom Buckingham Judy Bromfield Joanna Crompton Ian Butler Philippa Clough Blake Crawford Georgina Brittain Sarah Emly Ben Stapley James Ford Anis Lahlou-Abid Francesco Conte Alexander Fitzalan Howard Kyle Williams Rekha Halai Alex Whyte Edward Greaves John Baker Guy Anderson James Illsley Chris Llewelyn Tim Lewis Richard Webb John O’Brien Anthony Lynch Katen Patel David Allen Steve Satchell Client Portfolio Management Karsten Stroh Louise Bonzano Charlotte Crisp Will Johnson Ceri Jones Paul Shutes Nick Wilcox There can be no assurances that the professionals currently employed by J.P. Morgan Asset Management will continue to be employed by J.P. Morgan Asset Management or that the past performance or success of any such professional serves as an indicator of such professional’s future performance or success. 15
  • European equities at a significant discount to US counterparts Cyclically-adjusted PEs (CAPE) – US vs. Europe ex UK 60 MSCI US MSCI Europe ex UK 50 Current discount: 46% 30 yr average discount: 12% 40 30 20 10 0 83 85 87 89 91 93 95 97 99 01 03 Year Source: Datastream, J.P. Morgan Asset Management. As at 30 June 2013. Past performance is not a guide to future performance. 16 05 07 09 11 13
  • Europe – Global leaders at a discount Stock CAC40 Weight Domestic profits PE13 US peer PE13 Comment Total 11% Oil Major 3% 8.3x Exxon Mobil 11.5x Discount Sanofi 11% Pharmaceutical 5% 13.6x Johnson & Johnson 16x Discount LVMH 4% Luxury Goods 10% 18.3x Tiffany 21.3x Discount Danone 4% Food manufacturer 10% 18.3x Coca-Cola 18.1x Faster growth Description Source: Bloomberg, October 2013 17
  • Correction of structural imbalances Unit labour costs Trade balances with the eurozone Relative to Germany Six month moving average, € billions 150 7,5 Ireland 6,0 4,5 Italy 140 Spain Germany Italy Greece Greece Spain 130 Euro launch 3,0 120 1,5 0,0 110 -1,5 100 -3,0 90 '90 '95 '00 '05 -4,5 '10 '00 '02 '04 '06 '08 '10 '12 Source: Eurostat, ECB, FactSet, J.P. Morgan Asset Management “Guide to the Markets - Europe”. Data as at 30 September 2013. Source: ECB, FactSet, J.P. Morgan Asset Management “Guide to the Markets – Europe”. Data as at 30 September 2013. 18
  • Corporate financial strength European net debt/equity 60% € billion 900 58% 53% 55% 50% 45% Cash on MSCI Europe companies’ balance sheets 800 700 46% 44% 43% 42% 41% 600 40% 40% 500 33% 35% 400 30% 27% 300 25% 20% 20% 200 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 2016E 2015E 2014E 2013E 2012 2011 2010 2009 0 2008 10% 2007 100 2006 15% Source: J.P. Morgan Cazenove, Worldscope. Data ex-Financials, data as at 31 December 2012. Source: UBS, Based on UBS European Universe ex-Financials. Data as at 30 September 2013. 19
  • Big is not always better Returns have weakened as the fund has grown in size Performance Relative to Peer Group Returns Peer Group (5-95%): Open End Funds – Europe/HKG/TWN/SGP – Europe ex-UK Large-Cap Equity 40 Top Quartile 2nd Quartile 35 3rd Quartile Bottom Quartile 30 BlackRock European Dynamic A Acc 25 Currency: Pound Sterling 20 15 10 5 0 10 Years 5 Years 3 Years 1 Year YTD Time Series Size Fund size – comprehensive (Monthly) Time Period: September 2003 to August 2013 Currency: Pound Sterling 2,000m 1,750m BlackRock European Dynamic A Acc 1,500m 1,250m 1,000m 750m 500m 250m 0m Sep-03 Jun-04 Mar-05 Dec-05 Sep-06 Jun-07 Source: Morningstar Direct August 2013, IMA Sector = Europe ex-UK, in sterling 20 Mar-08 Dec-08 Sep-09 Jun-10 Mar-11 Dec-11 Sep-12 Jun-13
  • JPM Europe Dynamic (ex-UK) Fund Fund objective and risk profile Investment objective and policy To maximise long-term capital growth by investing primarily in continental European equities. Risk profile  The value of your investment may fall as well as rise and you may get back less than you originally invested.  The value of equity and equity-linked securities may fluctuate in response to the performance of individual companies and general market conditions.  The Fund invests in securities of smaller companies which may be more difficult to sell, more volatile and tend to carry greater financial risk than securities of larger companies.  This Fund is aggressively managed, which may result in higher volatility of the Fund's performance and bigger differences between the performance of the Fund and its benchmark.  For investors in Share Classes which are not hedged to Sterling, movements in currency exchange rates can adversely affect the return of your investment. Please refer to the Fund's prospectus for more information relating to the Fund. 21
  • J.P. Morgan Asset Management FOR PROFESSIONAL CLIENTS ONLY – NOT FOR RETAIL USE OR DISTRIBUTION This is a promotional document and as such the views contained herein are not to be taken as an advice or recommendation to buy or sell any investment or interest thereto. Reliance upon information in this material is at the sole discretion of the reader. Any research in this document has been obtained and may have been acted upon by J.P. Morgan Asset Management for its own purpose. The results of such research are being made available as additional information and do not necessarily reflect the views of J.P.Morgan Asset Management. Any forecasts, figures, opinions, statements of financial market trends or investment techniques and strategies expressed are unless otherwise stated, J.P. Morgan Asset Management’s own at the date of this document. They are considered to be reliable at the time of writing, may not necessarily be all-inclusive and are not guaranteed as to accuracy. They may be subject to change without reference or notification to you. It should be noted that the value of investments and the income from them may fluctuate in accordance with market conditions and taxation agreements and investors may not get back the full amount invested. Changes in exchange rates may have an adverse effect on the value, price or income of the product(s) or underlying overseas investments. Both past performance and yield may not be a reliable guide to future performance. There is no guarantee that any forecast made will come to pass. Furthermore, whilst it is the intention to achieve the investment objective of the investment product(s), there can be no assurance that those objectives will be met. J.P. Morgan Asset Management is the brand name for the asset management business of JPMorgan Chase & Co and its affiliates worldwide. You should note that if you contact J.P. Morgan Asset Management by telephone those lines may be recorded and monitored for legal, security and training purposes. You should also take note that information and data from communications with you will be collected, stored and processed by J.P. Morgan Asset Management in accordance with the EMEA Privacy Policy which can be accessed through the following website http://www.jpmorgan.com/pages/privacy. Investment is subject to documentation which is comprised of the Prospectus, Key Investor Information (KIID) and either the Supplementary Information Document (SID) or Key Features/Terms and Condition, copies of which can be obtained free of charge from JPMorgan Asset Management Marketing Limited. Issued by JPMorgan Asset Management Marketing Limited which is authorised and regulated in the UK by the Financial Conduct Authority. Registered in England No: 288553. Registered address: 25 Bank St, Canary Wharf, London E14 5JP. 22