Alpha Generators live blog from Munich
Today we bring you below streaming updates from the Alpha Generators event from Munich.
Fund managers speaking this morning are Michael Constantis from BlackRock; Suzanne Hutchins from BNY Mellon Asset Management; Chris Taylor from Neptune Investment Management; Peter Meany of First State Investments; and Philip Ehrmann from Jupiter Asset Management Limited.
Michael Constantis is portfolio manager of the BGF European Growth fund. He says that the crisis in Europe has helped create a cheap equity market relative to bonds, which benefits the fund because stocks in it are not dominated by generic European growth trends. “I’m very excited by the BGF European Growth fund. Stocks in the fund include some of the world-class leading franchises with exposure to stock-specific global growth trends. These stocks should outperform in the mid-term. The stock market sell-off has created an excellent opportunity to add to allocations at attractive valuations.”
Suzanne Hutchins is a global portfolio manager on the Real Return Strategy. The portfolio can range across a wide opportunity set of equities, bonds, high yield corporate debt, index-linked and cash, and gold through ETCs and gold-related shares, property (via shares), agriculture and currencies. Hutchins says that with so much debt in the developed world to be paid off and with little economic growth, as well as greater volatility and uncertainty, management requires an unconstrained approach to generate income in an environment of hard won returns.
Chris Taylor is head of research and fund manager on the Neptune Japan Opportunities fund. Like all funds at the company it follows a similar process of conducting global sector research to identify leading companies in each, to form a long list before valuation work to select the portfolio constituents. Taylor says that currently investing in Japan is about buying companies that dominate their sectors globally, and is nothing to do with Japan, with its population shrinking by about 1% annually. This poor domestic outlook is what has driven Japanese companies to change before their US and European rivals, leading to a sharper rebound in earnings despite the yen strength.
Peter Meany is manager of the First State Global Listed Infrastructure fund. He says that financial markets are clearly concerned by the slowing and inconsistent rate of global economic growth. However, in contrast the global listed infrastructure sector is driven by structural growth drivers such as urban congestion; replacement of aged/capacity constrained infrastructure; globalisation of trade; mobility of communication; changing supply, processing and demand in oil, gas and electricity markets; and infrastructure needed to support the economic development of emerging markets. Meany expects infrastructure earnings to remain robust throughout the remainder of this year and beyond.
Philip Ehrman is manager of the Jupiter China Sustainable Growth Sicav. Current investment themes often relate to domestic consumption and rising incomes as China moves away from singularly export-led growth. The themes are played out not only via consumption of goods and services, but also through Chinese companies “moving up the value-chain and providing the equipment to manufacture and produce what the newly enfranchised Chinese consumer wants – as opposed to importing the products or capital equipment from overseas.” Ehrmann is fairly confident the backdrop will remain supportive, not least because of the focus of the Chinese government’s Five Year Plan.