LF Canlife European Fund

LF Canlife European Fund

• The Fund invests mainly in the equity of European (Nordics, Eurozone, Switzerland) listed companies and can invest in all sectors of the market
• There is no specific target in relation to market sectors
• Exposure is predominately in large capitalisation companies but tactically invests in small and midcap when opportunities arise
• The target number of positions is 50-80
• Cash typically 0-2.5% (can go to 10%)
• The Fund can zero weight sectors or stocks where there is no conviction

For further details on the objective and investment policy, visit the Literature section to view fund KIIDs and Prospectus.

How the Fund is managed

The Fund uses a blend of top-down macro views and bottom-up stock selection to identify investment ideas in which have the highest conviction, it is flexible, pragmatic and mindful of prevailing macroeconomic and market conditions, for example; employment, inflation and gross domestic product  

• Fundamental analysis – specific holdings are determined through research that is undertaken by the Canada Life Asset Management’s equities team, including company visits and conferences.  The choice spans a variety of industries, services and geographical locations, allowing the manager to gain targeted exposure
• Sector selection - bottom up stock selection is a major factor in determining the shape of the overall Fund portfolio. However, sector allocations are also important in order to ensure balance and diversification. Typically, macro and market views are considered in order to balance the portfolio across factors such as growth, cyclicality and defensiveness. Additionally, the desired exposure to trends such as in bond yields and commodity prices are key considerations. This approach to portfolio construction allows us to deliver a diversified source of return from both a capital and income perspective
• Stock selection - typically across companies of all sizes, from large well-knowns to smaller scale operations.  The stock selection process itself takes into account several factors. These include the company’s market position, quality of its brand and underlying assets, how it fits in with current market and economic trends, and the specific drivers behind earnings and dividend growth. The managers will also conduct a thorough analysis of a company’s valuation, being sure to understand its earnings forecasts and any changes to a company’s strategy or management team.  There tends to be a bias towards small and medium-sized companies that are often under researched by the wider market