‘Ryanair nosedived – but I’ve bought more shares’

Professional investors are tipping the Continent as one of the bright spots for 2018 as the eurozone puts its problems behind it and outshines Britain and America. Telegraph Money last spoke to Rory Powe, manager of the top performing £1.2bn Man GLG Continental European Growth fund, before the EU referendum. Here he explains how Brexit has made Europe stronger and why he’s buying more Ryanair shares, names the tech stock that’s trebled in value in less than two years. where it looks like some countries might fall out of the eurozone. It has had very little impact or influence on our activity. About 70pc of the portfolio is in global companies, where the UK is a relatively small market. Where companies are more exposed to Britain they’ve either got natural hedges to the pound or they’ve been able to raise prices. The decision to leave actually galvanised the EU and, paradoxically, made it less likely that other countries would crash out.

We apply an uncompromising approach to investing in companies with formidable competitive advantages – firms with the staying power to thrive in most economic circumstances. The fortunes of these companies do not rely on a strong European economy. About three quarters of the firms in the portfolio are valued at more than $5bn (£3.7bn).

When I took over the fund [in 2014] it had more than 200 positions and I cut them to around 30 names. There’s an intellectual bottleneck: at more than 40 it becomes difficult for me to really understand each company.

Top fund manager Rory Powe tells Sam Brodbeck why European stocks are set to soar in 2018

Financials are under-represented. Too many firms are reliant on the underlying economies and their margins rely too heavily on interest rates. I want to avoid firms on the consumer front line as much as possible, as that’s where price compression is most evident. Unemployment is still high and consumers are better equipped with price and quality transparency than ever before. That means they have the power and being on the front line is one of the most hostile places to be. That’s where Amazon is eating many lunches. The Swiss firm VAT has contributed the most to the fund. It makes vacuum valves for semiconductors. Today’s market is about “miniaturisation” and that’s driven by demand from things such as mobile phones. VAT is the market leader, about eight times bigger than its nearest rival. We bought when it floated in March 2016 at below 50 Swiss francs (£38); it’s now roughly tripled to about 150.

Last year, Criteo, an ecommerce marketing company, was a very costly mistake. We invested in December 2016 and the share price has fallen by 40pc since then. I invested because it’s the leader in “retargeting”, an area of digital marketing. But Apple made changes that mean about a fifth of Criteo’s revenue is likely to disappear.

The lesson here is that when you’re up against a giant like Apple it can move the goalposts and upend the business model. This is the problem with technology, it’s so fast moving. I’ve aggressively reduced our position.

Yes, and my family’s. Over half of my wealth is in three funds across GLG. Founded by French mountaineers in the Fifties, Moncler, the luxury goods company, is a prime example of a business with a consumer base not threatened by Amazon.

The brand was bought by [Italian billionaire] Remo Ruffini in 2003 and completely rejuvenated. Revenues were less than €100m (£88.5m) then, and now exceed €1bn.

It floated in 2013 and is in robust health, both in terms of the quality and the design of its products. The company is extremely fastidious about the quality of its product, including things like the stitch, zips and duck down.

Its customers are high-end: jackets can sell for more than £1,000. More than 70pc of revenues come from outerwear that can be worn on and off the slopes. It has very successfully moved into apres ski, knitwear and

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