JPMorgan European Discovery (JEDT)

JPMorgan European Discovery (JEDT) is a high-conviction portfolio of European smaller companies, targeting capital growth across a range of sectors by focussing on under-researched businesses with the potential to grow. European smaller companies are often exposed to the big themes of the day, such as infrastructure and defence spending, electrification, AI spending, and healthcare, but while it’s helpful to think about themes, the JEDT team are primarily stock pickers and many companies in the portfolio operate in unique or idiosyncratic niches.

With an approximately 70-stock portfolio. the largest positions are between 2% and 3% of NAV, limiting individual stock risk in what can sometimes be a volatile asset class. But JEDT has a high active share, and performance can and does diverge from the benchmark. The current team managing JEDT was appointed on 01/03/2024, and since then they have built up a strong record of outperformance with an NAV total return of 37% compared to 28% for the benchmark (to 29/07/2026). Over the same period, JEDT’s discount has narrowed to 7%, and consequently the share price total return is 43%.

The team continue to believe that European small caps offer attractive valuations, but are also increasingly optimistic about earnings growth and, longer-term, about the opportunities that AI technology will offer to small companies. Although JEDT is primarily targeting capital growth, the last two years have seen strong earnings growth and the dividends for the year ending 31/03/2026 were 23% higher than the previous year, meaning JEDT yields 2.6%.