Rob Burnett, the fund's manager, positions the portfolio based on his views on the wider economy. At times he has shifted the portfolio aggressively between countries and industries, depending on his outlook. As the fund is positioned quite differently to many of its peers, performance has tended to deviate markedly from the average fund in the sector.
Over the past few years the fund has struggled to outperform the broader European market and, at times, it has heavily underperformed. As such the fund has not added any value above its benchmark for a considerable period; our analysis suggests the manager has struggled to add value through his stock selection for some time.
Furthermore, in recent years, the fund has been positioned to benefit from a euro zone recovery and this positioning has not been rewarded by the market. Rob Burnett has favoured areas he believes to be significantly undervalued, and the fund has held a considerable bias towards more economically-sensitive areas of the market. A large portion of the fund has been invested in financials, particularly in the banking sector, as well as Southern European countries. This has cost performance, particularly over the past year, as investors have tended to favour higher-quality, defensive businesses. The fund is concentrated which allows each holding to have a significant impact on performance although this is a higher risk approach.
At present, Rob Burnett retains his conviction in a euro zone recovery, especially across the periphery. If his views play out, the fund could perform well. On the other hand, if he is wrong, and the recovery weakens and deflation persists, the fund is likely to struggle.
Over the longer term, Rob Burnett has built a reasonable track record. However, the IMA Europe ex UK sector is highly competitive and it features a large number of high-quality managers with strong track records. The Wealth 150 is reserved for those in which we have the highest conviction and at present, we feel there are superior alternatives for new investment in this sector. Our preferred funds in this sector feature on the Wealth 150.
|Annual percentage growth|
| Jan 10 -
| Jan 11 -
| Jan 12 -
| Jan 13 -
| Jan 14 -
|Neptune European Opportunities||7.6%||-10.1%||11.5%||18.9%||-7.8%|
|IMA Europe ex UK||8.6%||-14.5%||18.0%||23.3%||0.1%|
|MSCI Europe ex UK||4.0%||-12.4%||16.6%||22.2%||1.8%|
Past performance is not a guide to future returns. Source: Lipper IM* to 02/01/2015