JPMorgan European Smaller Companies says that its net asset value total return was +17.7% in the six months to 30th September 2016 compared with the benchmark total return of +16.1% over the same period. The shareholder return was also positive despite the widening of the discount over the period. The share price total return was +10.3%. Discounts in the investment trust sector have widened since the result of the EU referendum. As at 30th September 2016 the discount was 16.4% compared to 10.8% at 31st March 2016.
The portfolio outperformed its benchmark largely due to stock selection. Top performers included Swedish cosmetics retailer, Oriflame, as a result of continued high growth in Asia, French furniture retailer, Maisons Du Monde, due to strong operational execution since its IPO in May 2016, and Italian branded stationary retailer, Moleskine, following a bid from Belgium company D’Ieteren. Poor performers in the period included Dutch exchange-traded products liquidity provider, Flow Traders, due to concerns around market share losses, German digital advertising company, Stroeer, as an equity research group raised accounting concerns, and Dutch temporary employment services provider, Brunel International, which suffered from a slower than expected recovery in the oil and gas sector and disruption in the Dutch market caused by a one-off tax change.
JESC : JPMorgan European Smaller ahead of benchmark