European Opportunities Dividends - JEO

European Opportunities Dividends - JEO

Stock Name Stock Symbol Market Stock Type
European Opportunities Trust Plc JEO London Ordinary Share
  Price Change Price Change % Stock Price Last Trade
0.00 0.0% 843.00 00:00:00
Open Price Low Price High Price Close Price Previous Close
843.00 843.00
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European Opportunities JEO Dividends History

Announcement Date Type Currency Dividend Amount Period Start Period End Ex Date Record Date Payment Date Total Dividend Amount

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Top Posts
Posted at 13/7/2021 09:45 by bottomfisher
Phillip Best, the senior independent director, has raised around £300,000 by selling close to 90% of his shares in JEO. He is due to retire at this year's AGM, so perhaps understandable. Nevertheless, hardly a resounding vote of confidence in the fund manager who has spent several million pounds over the last year buying over 900,000 shares.
Posted at 19/2/2021 19:10 by xtrmntr
When recently asked whether fraud was still rife in the modern corporate world, Terry Smith's answer was telling. "I think Wirecard (GER:WDI) answers that in a single word," he said.Not every star fund manager has the luxury of such observations. For Alexander Darwall, the nefarious practices that led to Wirecard's collapse have looked career threatening. Having at one point backed the stock to the tune of a 17 per cent allocation, Darwall still had a double-digit position in Wirecard via European Opportunities Trust (JEO) when auditor EY said it could not confirm the existence of €1.9bn (£1.67bn) in cash at the firm on 18 June 2020. This has dented the once top-performing trust's returns, as well as its reputation.Loyal fans have had the opportunity to buy in low since then. The discount to net asset value (NAV) at which the trust's shares trade widened out after the Wirecard bombshell and still sat at 10.5 per cent on 8 February. But big questions first need answering. Will the Wirecard episode ultimately be a one-off black mark against an otherwise illustrious track record or a sign of wider failings?We argue that the trust remains attractive – but only for investors who are happy with the risks of its high concentration approach. While the Wirecard scandal is highly unusual, it shines a light on the trust's real risks. Addressing concernsCriticisms of Darwall's approach must first be addressed. While the manager reduced his Wirecard position size some time before June 2020, he stuck with the company regardless of highly critical revelations by Financial Times' journalists and sustained concerns of short sellers. This points to specific weaknesses in his strategy.First, some would argue that Darwall and his team were happy to take the word of company's management and auditors rather than probing significantly deeper. Darwall was robust in his defence of Wirecard until the problems became undeniable. He acknowledged this himself in a recent presentation, saying "you can't rely on these people" of the accountants and regulators who dismissed Wirecard concerns. The investment team may also have become more sensitive to potential weaknesses in companies since. In September they appeared to sell out of Grenke (GER:GLJ) following a short attack on the stock, which remains controversial, although disclosures show they have rebuilt a small position since.A second criticism centres on position sizing. Darwall could have reduced his Wirecard position much more to offset the risks. The managers of a rival fund, Premier Miton European Opportunities (GB00BZ2K2M84), did exactly that. While the team trusted auditors' reassurances and held the stock, they limited the size of the position to reflect some concerns.European Opportunities Trust's board has responded to the issue of large position sizes in recent years. In early 2019 the board requested that no further shares should be added to the Wirecard position. A hard policy was then adopted that no position should be initiated or added to if it represented more than 10 per cent of total assets on the date of purchase. An expanded investment policy for the trust now states that the board will "pay particular attention to holdings which grow to represent more than 10 per cent of total assets".However, this is still a highly concentrated portfolio, meaning bigger risks and rewards. The trust's two biggest positions – Novo Nordisk (DEN:NOVO) and Experian (EXPN) – each sat near the 10 per cent mark at the end of January. The trust's top 10 holdings made up the majority of its assets.As one professional investor who holds the trust but did not want to be named puts it: "The stock size limit is helpful, but a 10 per cent holding that goes wrong can still do a lot of damage. But he has always run portfolios like this and running his winners has helped over time."Looking beyond Darwall's biggest mistakeThe latter half of this investor's statement, for us, outlines the enduring appeal of the fund. The manager did fall foul with Wirecard, but this was a sophisticated fraud that caught out auditors, regulators, analysts and some other fund managers. Yet Darwall's original approach, to take very high conviction stakes in companies with long-term, structural growth stories and run his winners, has otherwise proved highly successful over a long period. Importantly, the potential rewards have not lessened since the scandal. As the professional investor adds: "Simplistically, one bad stock call doesn't make him a bad fund manager, and the type of businesses he tends to buy don't really change over time."While Wirecard has tarnished Darwall's reputation the rewards of his approach still appeal, as long as investors understand that big bets bring equivalent risk.Darwall operates a high-conviction approach seen in several leading funds, from Lindsell Train's portfolios to Scottish Mortgage Investment Trust (SMT). Importantly, the stock picking itself has some defensive characteristics. Darwall favours businesses that have long-term structural growth stories, a level of pricing power, strong balance sheets and limited debt. In a recent presentation he added that the trust itself had low levels of debt given the current uncertainty in markets – 2 per cent of assets on 5 February, according to research company Morningstar.Similarly, he acknowledges the many macroeconomic threats to European economic growth, leading him to back companies with strong overseas revenues.This approach is reflected in the trust's long record of outperformance. In July, broker Stifel noted that 15 of the trust's holdings had been held continuously for three years or more, with 13 of them having outperformed.Beyond often boosting returns, the high concentration of the portfolio also gives investors an unusually clear view of what the team holds. The biggest holdings in the fund at the end of January included RELX (REL), French software company Dassault Systemes (FR:DSY1), Deutsche Börse (GER:DB1), asset manager Intermediate Capital (ICP), diagnostics specialist Biomerieux (FR:BIM), Grifols (SP:GRF), Genus (GNS) and Ubisoft Entertainment (FR:UBI).The trust's top 20 holdings, which recently included names such as ASML (NL:ASML), dubbed a "hidden tech gem" by Investors Chronicle, are disclosed once a month via stock market announcements.This trust certainly carries risks, and its mandate also complicates its place in portfolios. It has a quarter of its assets in UK stocks rather than a Europe ex-UK allocation, so can perhaps be best viewed as a standalone growth fund. Investors should also be aware of any crossover with other popular, highly concentrated funds: for example, LF Lindsell Train UK Equity (GB00BJFLM156) backs the likes of Relx and Experian.But for investors who understand the risks and are happy to keep an eye on this concentrated portfolio, there is no sign that Darwall has arrived at his Woodford moment yet. Buy. DB
Posted at 22/6/2020 08:20 by rooky4
Unfairly or not, Darwall will never regain his reputation after Wirecard.
And Devon is Darwall.

So it is time for brave board action - liquidate JEO, or move the mandate back to Jupiter. But don't just let the discount drift out for ever.

Posted at 02/2/2019 03:47 by cordwainer

How's that for growing pains?
Wirecard reached 17% of JEO's NAV and now that holding 25% down yesterday alone. I thought that holding was too big and too good to be true forever it's what encouraged me to reduce my JEO months ago. It's what I call managing portfolio risk. Mr Darwall probably still carries a healthy profit on Wirecard but maybe he could spare a thought for more recently invested JEO shareholders?

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