‘Our big­gest mis­take was back­ing the high street’

The Daily Telegraph - Your Money - - INVESTING -

Mi­ton Eu­ro­pean Op­por­tu­ni­ties cel­e­brated its third birth­day in some style last month, hav­ing been the best-per­form­ing fund in its sec­tor since launch. As three years is the typ­i­cal length of time in­vestors com­monly use to judge a fund’s track record, we felt the time was right for Tele­graph Money to quiz the man­agers be­hind the £376m fund, Thomas Brown and Car­los Moreno.

How would you sum up your in­vest­ment ap­proach?

CM: We al­ways do the same thing. Europe is a broad in­dex with maybe 1,500 stocks in the size range we’d in­vest in. We look for the baubles, the 50 best stocks within that uni­verse, buy them and hold on.

Who is the fund for?

TB: We don’t in­vest us­ing com­plex strate­gies – it’s a very sim­ple model so there is noth­ing in there to dis­suade any­one. But we pre­fer in­vestors who will stick with in­vest­ments for the medium to long term.

Which sort of hold­ings do you avoid?

TB: There are sec­tors that are just not par­tic­u­larly in­ter­est­ing to us. For ex­am­ple, util­i­ties are reg­u­lated to have a rel­a­tively mod­est re­turn on cap­i­tal. While peo­ple can make a lot of money in­vest­ing in util­i­ties, it is just not what we do. We are very dog­matic in what we are look­ing for and are con­sis­tent in hav­ing that strat­egy for the long term.

What do you like about Ger­many, Switzer­land and the Nordics?

TB: It just so hap­pens that we find re­ally good com­pa­nies that hap­pen to be in these re­gions.

Do you take pol­i­tics into ac­count when in­vest­ing in Europe?

TB: We don’t, un­less the en­tire

CV: Thomas Brown & Car­los Moreno

Mr Moreno o joined Mi­ton on in Au­gust 2015 from J JO O Ham­bro Cap­i­tal ap­i­tal Man­age­ment ent Group. Mr Brown be­gan at Mi­ton in Novem­ber 2015 from Mit­subishi UFJ As­set Man­age­ment (UK). in­vest­ment case hinged on it. If a com­pany pro­duced goods in Europe but sold only in the UK, for in­stance, and you knew what­ever hap­pens to the pound due to Brexit will have a big im­pact on where that busi­ness will be in three to five years’ time, that com­pany wouldn’t be for us. CM: For ev­ery com­pany we own that we think is some­what linked to the econ­omy, we own a com­pany that we per­ceive to be “de­fen­sive”, and we bal­ance it at all times to 50:50.

The man­agers of Mi­ton Eu­ro­pean Op­por­tu­ni­ties tell

about fu­tur­ol­ogy, Fer­raris, farm­ing (and funds)

The fund is do­ing well but is also young. What would you say to in­vestors who value longevity?

TB: I started in 1999, and Car­los has an­other five years on top of that. We’ve seen boom and busts, re­cov­er­ies – a lot has hap­pened. So we think we have de­cent ex­pe­ri­ence to bring to this.

Even in just three years, quite a lot has hap­pened in Europe. When we launched the fund, a lot of peo­ple were telling us Europe was a to­tal bas­ket case and un­in­vestible. Sen­ti­ment has swung be­tween ex­tremes of the pen­du­lum in just three years.

What was your big­gest mis­take?

TB: It sounds ridicu­lous to say it now, but we launched lau with H&M, the cloth­ing shop, in the port­fo­lio. It un­der un­der­per­formed the mar­ket and we sold it. Look­ing back it seems l lu­di­crous we would have launche launched with a high-street re­tailer, but we did. Thank­fully we cha changed our minds early in tha that process. Mo Moreno: We are in the fut fu­tur­ol­ogy game. Some­times


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