HEAD-TO-HEAD: JP Morgan versus Jupiter
By Francis Nikolai Acosta, 23 Nov 18
FSA compares the JP Morgan European Dynamic Fund and the Jupiter European Growth Fund.
Tanvi Kandlur, Financial Express
Investors soured on European equities in 2018 after the region delivered generally strong performance in 2017.
Last year, the MSCI Europe Index returned 13.72%. But year-to-date performance turned red at -6.27%, according to FE data.
“What happened in 2017 was Europe had [positive] earnings after years of consistent downgrades,” Tanvi Kandlur, London-based fund analyst at Financial Express, told FSA.
She explained that last year, European investors had also shrugged off political risk, such as the French elections.
However, the strong momentum last year was not sustainable. A host of issues emerged.
Throughout 2018, Eurozone growth slowed, there were squabbles with the US over tariffs and Italy began a budget battle with European authorities and became the new threat to the integrity of the European Union.
Add in the ongoing contentious Brexit negotiations, and it is clear why investor sentiment fell.
More investors also chose to increase allocations to US equities, as the US market continued a bull run that is nearly a decade-long, she added.
According to data from Fund Selector Asia’s Asset Class Research, European equities had the second lowest ranking in terms of forward-looking sentiment, among fund selectors in Asia.
Only 9% of fund selectors surveyed indicated that they will be increasing allocation to the asset class in the next 12 months, while 22% are expecting to reduce their holdings in European equities.
Against this backdrop, FSA asked Kandlur to look at two Europe (including UK) equity funds: The JP Morgan Europe Dynamic Fund and the Jupiter European Growth Fund.
John Baker, Jonathan Ingram, Anis Lahlou-Abid
|Three-year cumulative return*|
|Three-year annualised return*|
|Three-year annualised alpha|
|Three-year annualised volatility*|
|FE Crown Rating|
Source: FE Analytics
*21 Nov 2015 – 16 Nov 2018