- Alexander Darwall seeks companies with a unique and sustainable competitive advantage
- This has helped the fund hold up well in a variety of market conditions
- We believe he has one of the best stock-picking records in the European sector
Alexander Darwall, manager of the Jupiter European Fund, is a truly talented stock picker. He looks for something unique in the companies he invests in. They should offer a differentiated product or service that other companies fail to replicate. This means consumer demand should remain buoyant regardless of what's going on in the wider economy.
This approach has worked exceptionally well over the long term and means Alexander Darwall has built one of the most successful track records in the European sector. We believe he has the ability to continue to uncover some of the continent's greatest success stories. For this reason the fund features on the Wealth 150 list of our favourite funds across the major sectors.
Europe's economic backdrop got brighter over the past year – economic growth picked up, levels of unemployment fell, and company earnings improved. Investors reacted positively and the European stock market grew 12.7%* over the year.
Alexander Darwall invested in some of Europe's strongest-performing companies, which means the fund delivered an even better return of 24.4%. This is not a guide to how the market or fund will perform in future, however. He invests in a relatively small number of companies, which means each investment has a meaningful impact on performance, although this is a higher-risk approach.
|Annual percentage growth|
| Feb 2013 -
| Feb 2014 -
| Feb 2015 -
| Feb 2016 -
| Feb 2017 -
|FTSE World Europe ex UK||15.4%||5.2%||-5.2%||27.3%||12.7%|
Past performance is not a guide to the future. Source: Lipper IM* to 28/02/2018
Wirecard, which provides digital payment solutions, was one of the fund's strongest contributors to performance. The company has consistently grown its earnings, helped by an increasing number of payments made online. It's also gained business and benefited as some of its weaker competitors have been squeezed out of the digital payments industry.
Pharmaceuticals group Novo Nordisk also performed well – this is encouraging to see as it previously went through a tougher period of performance. Its share price rose after the US Food and Drug Administration approved the company's weekly treatment for type 2 diabetes.
After such a strong period of performance, Alexander Darwall believes it's prudent to maintain some caution as the European market will inevitably experience both good and weaker periods. For example, the European Central Bank's quantitative easing programme has helped keep markets buoyant in recent years, but the Bank plans to scale this back this year.
The manager has therefore invested the fund in a way that means it could hold up relatively well in a variety of market conditions. He favours companies that make profits from across the globe, have little debt, and are able to adapt to changes in consumer tastes, regulation, and technology. This is an approach that has proven a success in the past and we are confident about the fund's future prospects, though there are no guarantees.