Over the past ten years managing the Jupiter European Fund, Alexander Darwall has consistently outperformed the market. The secret to his success? “If I cannot understand something, then I will not invest in it, even if it is a large part of the index,” he says. So Darwall generally avoids banks. He is also “underweight commodities and cyclical companies because they are overly dependent on macro factors that are difficult to forecast”.
Instead he focuses on companies that have “a good track record of profitability, a proven product and business model”. So far, the strategy has paid off. His fund has maintained a top five ranking – out of more than 80 funds – for the last five years.
Darwall feels Europe gets a bad press. He notes that it “has frequently been dismissed by investors during the past decade, as attention has centred on the political and structural issues facing the region”. He also sees the rise of the emerging markets as an opportunity, not a threat, for European firms. “In my view, emerging markets and China will continue their ascendancy; European companies can be beneficiaries. Many European-listed companies offering special products or services and demonstrable good value to consumers can continue to prosper in exotic locations.”
One example is Syngenta – a stock he has held since 2001. Its crop protection products boost agricultural yields and tie into rising agricultural demand from emerging markets. “Technology is likely to be a significant driver of agricultural development in future and Syngenta, as a world leader, is exceptionally well placed.”
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Jupiter European’s top ten holdings
| Name of holding | % of assets |
|---|---|
| Novo Nordisk | 7.87 |
| Novozymes | 7.63 |
| Syngenta | 5.82 |
| DnB NOR | 5.39 |
| Neopost | 4.98 |
| Vopak | 4.25 |
| Reed Elsevier | 4.24 |
| Dassault Systemes | 3.68 |
| Wirecard | 3.67 |
| Schneider Electric | 3.61 |