The case for setting up a Market Strategy Europe
With global organic top-line growth depressed, balance sheets strong, and financing costs at historic lows, companies are looking for external growth. Investors can benefit in two ways:
- M&A: Potential targets offer an attractive premium in the event of an actual takeover
- Follow-through impact: Some companies have already announced acquisitions.
These opportunities should be able to provide an above-market earnings growth, based on exploiting cost synergies, as well as revenue/distribution synergies.
Scope of investments
Our core equity portfolio is focused on a European Smart-Beta index, considering the following factors: Growth, Value, Momentum, Volatility, Quality, and Size. The allocation is equally weighted and rebalanced once a month. The objective of the strategy is to outperform the Stoxx600 Index.
The complementary allocation reflects opportunities that benefit from global macro trends. Here, we select several companies within each promising industry whose financial strength and business model are best positioned for long-term capital appreciation. This part of the portfolio can contain some 15-20 stocks with exposure to our preferred secular trends.
Our present preference goes to
- Empowering Consumers: Adidas, Kering, Volkswagen, Fraport
- IIoT: AMS, ASML, Logitech
