JPMorgan European Growth & Income (JEGI)

JPMorgan European Growth & Income (JEGI) provides investors with a ‘core’ European equity vehicle, using JPMorgan’s quality, value, and momentum investment factors. The aim is to add incremental value of one or two percentage points a year above the benchmark within a risk-controlled framework. JEGI‘s portfolio is diversified across approximately 100 holdings. Sector and geographic exposures are risk controlled against the benchmark, although there is some flexibility. But the main source of returns is from stock picking, and the JEGI team consistently applies their ‘value’, ‘quality’, and ‘momentum’ analysis to assess portfolio holdings.

Over the last five years, JEGI has delivered strong outperformance with an NAV TR of 102%, exceeding the peer group average of 38% and the benchmark’s 68%. In the Performance section, we look at how shorter-term performance over the last year has also exceeded both comparators, and is particularly notable when many active managers have struggled to keep up with the benchmark.

JEGI pays quarterly Dividends using a mixture of current income and reserves, setting the dividend rate for each year with reference to 4% of the closing NAV for the preceding year. Strong performance, a rigorous approach to share buybacks, and the dividend policy have all helped to close JEGI’s discount and at time of writing, the share price trades at around the same level as the net asset value.

JEGI is managed by an experienced team of three: Alexander Fitzalan Howard, Zenah Shuhaiber, and Timothy Lewis. Alexander has managed JEGI since 2006, and Zenah and Timothy both joined Alexander as JEGI portfolio managers in 2020. The trust is modestly geared at c. 6%, in keeping with its ‘core’ objective.