Focus on: Cazenove European
Our ‘focus on’ articles each look at a specific investment fund within our top sixty. We take an in-depth look at each fund to give you an insight into what it takes to make the grade.
Each ‘focus on’ examines the objective of the fund, an analysis of recent performance, the manager, charges and other factors.
Within this ‘focus on’ we take a closer look at the Caznove European fund. This fund sits within the European Equities asset class.
Fund objective
This fund aims to achieve long-term capital growth by investing in any or all European markets, excluding the UK. It aims to maximise the overall rate of return with capital growth as the primary goal.
The Authorised Corporate Director (ACD) of this fund seeks to invest in a diversified list of companies. The manager looks for industry groups demonstrating above average growth prospects; factors such as strong financial characteristics and proven management are emphasised.
This fund has a flexible country allocation strategy which delivers additional diversification.
Track record
This is a first quartile fund over one, three and five years. For the year to date it has returned 15.79% compared to a sector average return of 10.17%. This places it 23rd out of 196 funds in the sector.
This fund has a strong and consistent long-term performance record, with first or second quartile performance in every discrete annual period since 2004.
The managers
This fund is managed by Chris Rice and Steve Cordell. Rice is the head of Cazenove’s European team and Cordell is their pan-European fund manager. They previously worked together at HSBC.
Rice has been with Cazenove since 2002 and has been running this fund since joining them. He has seventeen years fund management experience, previously running the HSBC European Growth fund between 1999 and 2002.
The management partnership of Rice and Cordell is supported by two dedicated European analysts; Lionel Rayon and Morten Herholdt. This small team has substantial combined experience which should reassure prospective investors.
Style
This fund takes a top-down approach, making use of business cycle analysis to weight the fund towards their favoured stocks which demonstrate the right style characteristics. Their stock selection process focuses on growth and valuations. The managers claim to control risk tightly by the consistent application of this process.
Charges
The fund has a 5.00% initial charge and a 1.5% annual management charge, with a total expense ratio (TER) of 1.65%.
Conclusion
Europe is an incredibly diverse investment arena, particularly in the current economic environment, with some of more established economies having to support the weaker nations within a single currency infrastructure. The use of an actively managed fund with discretion about country allocation is vital when it comes to investing in Europe. Cazenove European is one of the strongest and most consistent performers in this sometimes difficult investment sector.
Martin Bamford is site editor of BrilliantWithMoney and a Chartered Financial Planner at Informed Choice.
The small but important print: This article was produced for information only and should not be considered a recommendation to buy, sell or hold a particular investment fund. Seek advice from a professional independent financial adviser before making a decision. The performance data in this article was provided by Financial Express and was correct as at 28th September 2009.
