S&P Capital assigns Silver grading to Alliance Trust European Equity fund
S&P Capital IQ Fund Research has assigned a Silver grading to the Alliance Trust European Equity Fund.
This fund is managed by a three-strong which also contributes European stock ideas to the investment trust for which the group is best known.
The fund’s objective is to outperform the MSCI Europe ex UK index (in sterling) by 2% net over the medium term.
Idea generation is both bottom-up, drawing on a FactSet valuation screen on index names relative to their sector and the index, and top-down, with the team identifying longer-term themes through an assessment of the macroeconomic environment.
This macro view is also crucial when evaluating financial names where the team takes input from the Economics Research Centre, the in-house fixed income team and the sell-side.
Excluding financials, the team builds simplified valuation models from scratch, and the portfolio may contain a number of bottom-up ideas, including restructuring stories. The portfolio is relatively focused with 25-35 holdings, with no constraints at sector or country level.
The management team is headed by Fiona MacRae and composed by Athole Skinner and Tommy Bryson.
They also make use of the in-house macro team and the newly assembled global equity sector analyst team. Input is taken from the sell-side and the fixed income team for financials.
The team divides sector responsibilities between its members, and there is a large element of debate in the decision-making process, with valuation models circulated among the team and the assumptions discussed.