European Assets in positive territory

15th Oct 2010 15:44

European Assets Trust, the investment trust that invests in medium sized European companies outside of the UK, saw its returns for the year move into positive territory in the third quarter.Net assets in euro terms rose to €112.5m at the end of September from €105.7m, while, in percentage terms, the sterling performance was better still, with net assets rising to £97.4m from £86.5m.Basic net asset value per share (NAV) rose 8.6% in the third quarter to €7.44, or 14.9% in sterling terms to 572.5p. This compared to a 9.2% gain (in euro terms) or a 15.4% increase (in sterling terms) by the HSBC Smaller Europe (excluding UK) index, the benchmark against which its investment performance is measured. The total return for the first nine months of 2010 was 9.7% (7.0% in sterling terms), which bested the performance of its benchmark index, which rose 8.9% (6.2% in sterling terms).Since the change in June 2010 of the lead investment manager responsible for the portfolio, the portfolio has been evolving towards a structure which aims to balance capital growth with capital protection through focussing on long term positions in high quality businesses with economics and growth potential that the company believes to be undervalued."Looking forward we see that whilst in the medium term, the weight of fiscal consolidation will anchor headline rates of economic growth, the strength of company balance sheets and the imperative towards scale and efficiency should provide a good outlook for equities over the medium term," the company said.