HEAD-TO-HEAD: Eastspring versus Jupiter

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The Eastspring fund versus its benchmark (MSCI Europe Index) and the Jupiter fund versus its benchmark (FTSE Europe Index). Source: FE Fundinfo. In US dollars.

PERFORMANCE

As both offerings have concentrated portfolios, the strength of stock selection is expected to be the primary driver of the relative performance of both funds, according to Meakin.

“For both strategies, the unconstrained mandates mean that sector and country weightings can deviate significantly from the respective index and peer group, with the potential for performance deviation on that basis, particularly over shorter time periods,” he said.

“However, stock specifics are likely to dominate over the longer term.”

So far, the Jupiter fund has held up better, especially earlier this year. Meakin explained that that was expected, given the higher quality focus of the strategy.

However, he noted that the fund now holds more valuation risks.

“With the greater quality/growth bias in the Jupiter fund, valuation risk is higher at present, and in the event of a reversal of the current market leadership, underperformance could be greater,” he said.

Annual calendar performance

Source: FE Fundinfo. In US dollars.

Like their performance, Meakin believes that volatility will be affected by stock specifics.

“For example, the Eastspring fund’s volatility has been higher recently in part due to the large position in WH Smith, which was hit badly as a result of the Covid pandemic,” he said.

Three-year annualised volatility

Source: FE Fundinfo

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