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Euro small cap star: why we swapped asset managers for private banks
by Sarah Miloudi on Oct 02, 2013 at 12:03
After moving his £374 million portfolio away from defensive growth stocks and towards four key themes revolving around restructuring, financials, cyclicals and growth stocks, Conte said private banks are awash with cash and stand to benefit when their clients rotate into equities.
Conte told Wealth Manager that asset managers such as GAM were once a favoured play within financials picks, but as valuations crept up, it became clear the next phase of the rally was about to begin.
'Private banks, for example we own EFG, have most of their customers' assets in either bonds, cash or quasi cash.
'The model of these banks is as the risk appetite of their investors goes up and they move more towards equity products, margins go up and there's a lot of operational leverage, so I think private banks could be a very interesting place to be,' Conte explained.
In this video, Conte, who runs the JP Morgan European Smaller Companies trust alongside Jim Campbell, also explained why investors should not be overly concerned about the choppy political landscape in Italy.
He believes its strong companies can weather the storm, and also outlined the opportunities he has found in three Greek stocks.
Despite the difficulties in Europe, Conte and Campbell's trust has continued to deliver for investors. It is ranked second in its peer group over three years, according to Citywire data, and its share price has risen 44.8% over the same stretch.
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on Dec 06, 2013 at 14:28