Schroders’ Turner added to Europe ahead of summit
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Schroders multi-manager Jane Turner moved her weighting in European investments to neutral ahead of the EU summit, which saw a resolution to the crisis move a small step closer.
The manager had been at a neutral weighting to the continent in January after purchasing some German Dax futures. She then sold these in February and March, which meant her funds were once again underweight the continent.
However, Ms Turner increased her exposure to Europe through actively managed funds in May - a month ahead of the summit. She bought a new holding in Schroders’ own £659.7m European Alpha Plus fund, run by Leon Howard-Spink.
The vehicle represents half of Ms Turner’s exposure to Europe and sits alongside the £229m Ignis Argonaut European Alpha fund managed by Barry Norris.
The move by the manager will have been beneficial given German concessions at the summit, which included an agreement to restructure Spain’s €100bn (£80.7bn) bank recapitalisation plan. The new plans will see EU bailout funds being injected directly into the country’s banks.
Furthermore, Germany indicated it was prepared to intervene to shore up Italian and Spanish borrowing costs, saying eurozone leaders should use existing powers with their €440bn rescue fund for short-term help.
In the last week of June, the FTSEurofirst 300 index gained 4.5 per cent. The gain of 6.1 per cent for the month as a whole made it the best for the index over the year so far. The second strongest monthly gain was February’s 3.7 per cent.
Speaking before the summit, Ms Turner said: “We reduced the underweight recently as Europe got to such low valuations. It could go lower because there is a lot of uncertainty, and growth will likely be subdued, but if we see some co-ordinated policy response we could se a relief rally.”