BlackRock Greater Europe Investment Trust plc (LON:BRGE) is co-managed by Stefan Gries (appointed on 20 June 2017), who focuses on developed European markets, and Sam Vecht, who focuses on emerging Europe. They aim to generate long-term capital growth from a relatively concentrated portfolio of 35-40 European equities, mostly from developed markets. BRGE’s investment performance has improved following Gries’ appointment, since when the trust has outperformed the FTSE World Europe ex-UK reference index by c 5pp. As well as positive contributions from portfolio companies, both in developed and emerging Europe, BRGE has benefited from not holding some of the larger European companies that have underperformed the broader market.
Investment strategy: Bottom-up stock selection
Since Gries became co-manager in June 2017, BRGE has tightened up its research process, while adhering to the aim of seeking companies whose underlying earnings power is not fully reflected in their current share prices. The investment team undertakes thorough fundamental research, focusing on companies with quality management teams, a unique offering (such as a product or brand), the ability to invest in future growth, and which are generating high returns and free cash flow conversion. Meeting companies is a key part of the research process and the 21-strong investment team conducts c 1,000 meetings a year. Gearing of up to 15% of NAV is permitted; at end-February 2018, net gearing was 5.0%.
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