J.P. Morgan Europe Equity portfolios are managed by our European Equity Group—a 65-strong team responsible for assets of more than USD 23 billion. The investment professionals in the team offer a depth of expertise, with an average of 16 years experience in the industry.
We offer two distinct, yet complementary, investment processes within the European Equity Group—our Behavioural Finance Process and our Research Driven Process. Portfolios following both processes aim to deliver long-term returns that exceed their benchmarks through disciplined stock selection. We offer a range of products across the risk/return spectrum, designed to meet a broad spectrum of investor requirements.
Behavioural Finance Process
Our Behavioural Finance Process is based on the belief that that attractively valued, high quality stocks with positive momentum outperform the market due to pricing anomalies caused by persistent and identifiable investor behavioural biases.
Our portfolio managers select individual stocks that have one or more of the Value, Quality, and Momentum characteristics we seek from a universe of approximately 2,000 pan-European stocks. We then efficiently combine these stocks to build a portfolio that is collectively cheaper, has higher quality, and has better momentum than the market. We believe that by combining stocks with strong Value, Quality and Momentum characteristics in a single portfolio we can outperform on a more consistent basis and through different market cycles.
Research Driven Process
Our Research Driven Process is based upon the partnership between our dedicated European equity portfolio managers and our team of career buy-side European equity research analysts. The research analysts seek to identify attractive stocks based upon three price drivers: Intrinsic Value, Quality and Catalyst. As the analysts conduct proprietary research, we are able to create a genuine information advantage that gives us the potential to deliver strong investment returns to our clients.
Our Research Enhanced Index (REI) strategy is the lowest risk offering from our Research Driven Process team. Our aim in this strategy is to deliver positive excess returns with low active risk to achieve high information ratios. Our European REI portfolios closely approximate the risk of the benchmark with the focus on adding value through stock selection. Uncompensated risk is minimised using an optimisation framework which limits stock specific, sector, style and country risks as well as trading costs.