HEAD-TO-HEAD: Aberdeen Standard versus Jupiter

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INVESTMENT APPROACH

Both the ASI and Jupiter funds are high-conviction European equity funds, both holding just around 30 stocks in their portfolios, according to McDermott.

As of the end of November, the top 10 holdings of the ASI offering already account for around 40% of its assets, while Jupiter fund’s top 10 account for half of its portfolio, according to their fund factsheets.

While both products are concentrated and are positioned for growth, McDermott noted that their investment approaches are different.

For example, the ASI fund typically has a more large-cap bias compared to the Jupiter product, he said. Large- to giant-cap names account for 40.59% of the ASI offering, versus the 15.82% of the Jupiter fund.

Source: Morningstar Direct. As of the end of November 2020.

In addition, the ASI fund is growthier.

“It is reasonably diversified [in terms of its sector allocation], but has a growing exposure to technology in the past three years,” McDermott said.

Nearly 30% of the ASI fund’s assets are invested in technology, while the Jupiter fund has 15.1% in the sector, their fund factsheets show.

Turning to the Jupiter fund, McDermott said that it focuses on business characteristics that have “enduring advantage”.

“High barriers to entry and industry structure (industries that are not driven by a single supplier who can squeeze profit margins) are both seen as attractive attributes,” he said.

The fund is usually underweight companies with high amounts of leverage, which include those that belong to the telecoms, banking and property sectors, and overweight in names with exposure to global revenues, he added.

Top 10 holdings:

Source: Fund factsheets. As of the end of November 2020.

Sector allocation

Source: Fund factsheets. As of the end of November 2020.

Country allocation

Source: Fund factsheets. As of the end of November 2020.

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