Europe: a window to global opportunities


Europe is home to some of the world’s most recognised brands, leading innovators and dominant businesses. From best-in-class operators to trailblazers expanding in emerging markets, we think Europe has much to offer.

This Sub-Fund aims to capture the diverse investment opportunities available across three distinct categories: Quality, Growth and Events. This diversified approach aims to help investors navigate economic and market cycles more smoothly.1

 

sub-fund information.

Click here to access the sub-fund information.

 

europe: a window to global opportunities.

Icone - Europe High Conviction_Emerging_markets_growth.jpg Icone - Europe High Conviction_European_landscape.jpg
397 million people
Beyond its domestic markets, some European companies also offer access to emerging markets growth.2
17 countries
The European landscape is highly varied, with flourishing businesses co-existing alongside challenged ones.3 
    Icone - Europe High Conviction_Atrractive_destination.jpg  
  € 14 trillion GDP
Europe’s sheer size makes it an attractive destination for equity investors.4
 

 

Why invest?

 

Truly active stock picking 

  • Research-intensive – the team focuses on bottom-up analysis to identify mispriced companies that can grow profitably and have a competitive edge over their peers. They also look at catalysts that may influence a company’s stock. 
  • Diversified – each investment must fit into one of three categories (see below), allowing the Sub-Fund to seek better diversification and navigate through bull and bear markets. 
  • High conviction – a highly active portfolio targeting 30 to 40 stocks, typically with a mid to large cap bias. The team favours depth over breadth.

 

Award-winning approach.5

  

4Star_Seal_OverallRating.jpg (Seal_OverallRating) Fitch_StrongSeal_TM_v2.jpg (Title) Citywire Euro Stars logo - 2017.png 5-total return.jpg (Print)
citywire-rating-aa__628x128px.png

 

A balanced allocation across three distinct categories6

 

1. Quality

Investable universe: 60-70 stocks 25-40% of the portfolio

High quality companies with a dom-inant competitive position and high barriers to entry

 

2. Growth

Investable universe: 80-90 stocks 25-40% of the portfolio

High growth companies with above-average revenue growth.

 

3. Events

Investable universe: c.150 stocks 25-40% of the portfolio

Candidates for takeovers, break-ups and other corporate events.

Examples

 

 

 

 

A global chemicals supplier proved its pricing power in an oligopoly market. It grew 5% across the cycle, with a cash-generative business model.

 

Despite the challenging consumer environment, a UK discount retailer gained market share through a focused product range and direct sourcing model.

 

A growing European telecoms company was in a consolidating sector. It was eventually acquired by a global operator.

The Sub-Fund does not invest in stocks or sectors that do not fit within the above three categories; in particular those assets that the team cannot value confidently, such as banks, insurers, miners and energy companies.

 

investment team.

 

LOcom_AuthorsAM-Dionisio.png Peter Dionisio
Portfolio manager
LOcom_AuthorsAM-Marquaire.png Cyril Marquaire
Portfolio manager
LOcom-AuthorsAM-Johns.png Henry Johns
Analyst
LOcom-AuthorsAM-Pizano.png Alexandre Pizano
Analyst

 

investment philosophy.

 

At Lombard Odier Investment Managers, we believe sustainability has the potential to drive future returns7

 

1

Sustainable financial models 
We look for attractively-priced companies that can deliver sustainable growth, which we consider to have a transparent and solid business model and have a competitive advantage over their peers.

2 Tiered portfolio construction
We believe high quality companies tend to outperform in down markets; high growth companies can benefit in rising markets; and corporate event candidates tend to profit in M&A-fuelled environments. By allocating to all three buckets, we aim to diversify the risk
3 Risk management
We believe high performance starts with stringent risk management. The team continuously monitors 12 trading and fundamental risk metrics, which also serve to maintain investment discipline. An independent risk management team monitors the portfolio alongside the investment team.

The end result 

The result is a core European portfolio that aims to outperform over the medium to long term. The team equally weights portfolio holdings, where possible, to provide sufficient diversification without diluting potential returns.

 

By taking a long-term view, we avoid betting heavily on market direction and focus instead on sustainable businesses that we believe can unlock value over time.

 

download.

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sub-fund information.

Click here to access the sub-fund information.

 

watch our video.

 

sources.

1 There can be no assurance that the Sub-Fund’s investment objective will be achieved or that there will be a return on capital or that a substantial loss will not be incurred.

2  Source: Eurostat, May 2018.

3 Countries within the Sub-Fund’s universe include: Germany, France, UK, Italy, Spain, Netherlands, Portugal, Belgium, Sweden, Switzerland, Denmark, Finland, Norway, Ireland, Greece, Luxembourg and Austria.

4 Source: LOIM, Millicom, ABB, Wartsila, PZ Cussons and SEB company websites. Any reference to a specific company or security does not constitute a recommendation to buy, sell, hold or directly invest in the company or securities.

5 Sources: Morningstar, 31 July 2018. EAA OE Europe Flex-Cap Equity. See here for more information on methodology. / Citywire, 30 June 2018. Equity – Europe. See here for more information on methodology. / Lipper Leaders – Thomson Reuters, 31 July 2018. Overall Total Return and Consistent Return categories. See here for more information on methodology. / Fitch Ratings, 3 January 2018. See here for more information. Ratings and awards subject to change without notice. Past performance is not a reliable indicator of future returns. Citywire Euro Stars at November 2017 and valid for one year. See here for more information on methodology.

6 Target asset allocation and portfolio composition represent a portfolio construction goal. Examples for illustrative purposes only. Holdings/allocations are subject to change. Any reference to a specific company or security does not constitute a recommendation to buy, sell, hold or directly invest in the company or securities. It should not be assumed that the recommendations made in the future will be profitable or will equal the performance of the securities discussed in this document.

7 There can be no assurance that the Sub-Fund’s investment objective will be achieved or that there will be a return on capital or that a substantial loss will not be incurred.

important information.

Lombard  Odier  Funds  (hereinafter  the  “Fund”)  is  a  Luxembourg  investment  company with variable capital (SICAV). The Fund is authorised and regulated by the  Luxembourg  Supervisory  Authority  of  the  Financial  Sector  (CSSF)  as  an  Undertaking  for  Collective  Investments  in  Transferable  Securities  UCITS  under  Part I of the Luxembourg law of the 17 December 2010 implementing the European directive   2009/65/EC,   as   amended   (“UCITS   Directive”).   The   Management   Company  of  the  Fund  is  Lombard  Odier  Funds  (Europe)  S.A.  (hereinafter  the  “Management  Company”),  a  Luxembourg  based  public  limited  company  (SA),  having its registered office at 291, route d’Arlon, 1150 Luxembourg, Grand Duchy of Luxembourg,  authorised  and  regulated  by  the  CSSF  as  a  Management  Company  within  the  meaning  of  EU  Directive  2009/65/EC,  as  amended.  This  marketing  document  relates  to  “Europe  High  Conviction,”  a  Sub-Fund  of  Lombard  Odier  Funds (hereinafter the “Sub-Fund”).This marketing communication was prepared by Lombard Odier Asset Management (Europe) Limited.The   prospectus,   the   articles   of   incorporation,   the   Key   Investor   Information   Documents,  the  subscription  form  and  the  most  recent  annual  and  semi-annual  reports  are  the  only  official  offering  documents  of  the  Sub-Fund’s  shares  (the  “Offering Documents”). The Offering Documents are available in English, French, German and Italian at www.loim.com and can be requested free of charge at the registered   office   of   the   Sub-Fund   in   Luxembourg:   291   route   d’Arlon,   1150   Luxembourg, Grand Duchy of Luxembourg.The  information  contained  in  this  marketing  communication  does  not  take  into  account any individual’s specific circumstances, objectives or needs and does not constitute  research  or  that  any  investment  strategy  is  suitable  or  appropriate  to  individual circumstances or that any investment or strategy constitutes a personal investment advice to any investor. This marketing communication is not intended to  substitute  any  professional  advice  on  investment  in  financial  products.  Before  making an investment in the Sub-Fund, an investor should read the entire Offering Documents,  and  in  particular  the  risk  factors  pertaining  to  an  investment  in  the  Sub-  Fund.  We  would  like  to  draw  the  investor’s  attention  toward  the  long-term  nature  of  delivering  returns  across  the  economic  cycle  and  the  use  of  financial  derivative instruments as part of the investment strategy may result in a higher level of leverage and increase the overall risk exposure of the Sub-Fund and the volatility of  its  Net  Asset  Value.  Investors  should  take  care  to  assess  the  suitability  of  such  investment   to   his/her   particular   risk   profile   and   circumstances   and,   where   necessary, obtain independent professional advice in respect of risks, as well as any legal,  regulatory,  credit,  tax,  and  accounting  consequences.  There  can  be  no  assurance that the Sub-Fund’s investment objective will be achieved or that there will  be  a  return  on  capital.  Past  performance  is  not  a  reliable  indicator  of  future  results. Where the Sub-Fund is denominated in a currency other than an investor’s base currency, changes in the rate of exchange may have an adverse effect on price and income. Please take note of the risk factors. Any benchmarks/indices cited herein are provided for information purposes only. No benchmark/ index is directly comparable to the investment objectives, strategy or universe of a Sub-Fund. The performance of a benchmark shall not be indicative of past or future performance of any Sub-Fund. It should not be assumed that the relevant Sub-Fund will invest in any specific securities that comprise any index, nor should it be understood to mean that there is a correlation between such Sub-Fund’s returns  and  any  index  returns.  Target  performance/risk  represents  a  portfolio  construction  goal.  It  does  not  represent  past  performance/risk  and  may  not  be  representative of actual future performance/ risk.The  information  obtained  from  MSCI  included  in  this  marketing  document  may  only be used for your internal use, may not be reproduced or re-disseminated in any form  and  may  not  be  used  to  create  any  financial  instruments  or  products  or  any  indices. The MSCI information and that of other data providers is provided on an ‘as is’ basis and the user of this information assumes the entire risk of any use made of this information. MSCI, each of its affiliates and each other person involved in or related  to  compiling  or  creating  any  MSCI  information  (collectively,  the  “MSCI  Parties”)  and  other  data  providers,  expressly  disclaim  all  warranties  (including,  without    limitation    any    warranties    of    originality,    accuracy,    completeness,    timeliness, non-infringement, merchantability and fitness for a particular purpose) with respect to this information. Without limiting any of the foregoing, in no event shall  any  MSCI  Party  or  other  data  provider  have  any  liability  for  any  direct,  indirect, special, incidental, punitive, consequential (including, without limitation, lost profits) or any other damages.The information and analysis contained herein are based on sources considered to be reliable. Lombard Odier makes its best efforts to ensure the timeliness, accuracy, and completeness of the information contained in this marketing communication.Nevertheless, all information and opinions as well as the prices, market valuations and calculations indicated herein may change without notice. Source of the figures: Unless otherwise stated, figures are prepared by Lombard Odier Asset Management (Europe) Limited. The tax treatment depends on the individual circumstances of each  client  and  may  be  subject  to  change  in  the  future.  Lombard  Odier  does  not  provide tax advice and it is up to each investor to consult with its own tax advisors.NOTICE TO R ESIDENTS IN THE FOLLOWING COUNTR IES:Austria – Paying agent: Erste Bank der österreichischen Sparkassen AG.Belgium – Financial services provider: CACEIS Belgium S.A. The Sub-Fund is not appropriate for Belgian retail investors unless the investment subscription is more than EUR 250,000. Please contact your tax advisor to identify the impacts of the Belgian tax “TOB” (“Taxe sur les Operations Boursières”) on your transactions, as well  as  the  impacts  of  the  withholding  tax  (“Précomptes  mobiliers”).  Lombard  Odier has an internal Complaints Management Service. You can lodge a claim via your Relationship Manager or directly to Lombard Odier (Europe) S.A. Luxembourg, Belgium  Branch,  Claim  Management  Service,  Avenue  Louise  81,  Box  12,  1050  Brussels, Fax: (+32) 2 543 08. Alternatively you can address your complaint free of charge to the national complaint service in Belgium, OMBUDSMAN: North Gate II,  Boulevard  du  Roi  Albert  II,  n°8  Boîte  2  2,  1000  Brussels,  Tel  :  (+32)  2  545  77  70,  Fax : (+32) 2 545 77 79, Email: Ombudsman@Ombusfin.be.Chile: The Sub-Fund has been approved by the Comision Clasificadora de R iesgo (CCR) in Chile for distribution to Chilean Pension Funds under Agreement Nr 32 of the CCR.France – Centralising agent: CACEIS Bank. The Sub-Fund permanently invests a minimum of 75% of its assets in European Economic Area equities, and is therefore PEA (Plan d’Epargne en Actions) eligible in France.Germany    –    German    Information    and    Paying    agent:    DekaBank    Deutsche    Girozentrale.Italy – Paying agents: Société Générale Securities Services S.p.A., State Street Bank International GmbH – Succursale Italia, Banca Sella Holding S.p.A., Allfunds Bank S.A.U.,  Milan Branch, BNP Paribas Securities Services, CACEIS Bank, Italy Branch.Liechtenstein – Paying agent: LGT Bank AG.Luxembourg – Depositary, central administration agent, registrar, transfer Agent, paying agent and listing agent: CACEIS Bank,  Luxembourg Branch.Netherlands  –  Paying  agent:  Lombard  Odier  Asset  Management  (Europe)  Ltd,  Netherlands Branch.Spain – Paying agent: Allfunds Bank S.A.U. – CNMV Number: 498.Sweden – Paying agent: Skandinaviska Enskilda Banken AB (publ).Switzerland – The Sub-Fund is registered with the Swiss Federal Financial Market Supervisory Authority (FINMA). The Offering Documents together with the other Shareholders’ information are available free of charge at the Swiss Representative: Lombard  Odier  Asset  Management  (Switzerland)  S.A.,  6,  avenue  des  Morgines,  1213  Petit-Lancy,  Switzerland.  Swiss  Paying  Agent:  Banque  Lombard  Odier  &  Co  Ltd. 11, rue de la Corraterie 1204 Genève, Switzerland. Publications about the Sub-Fund: www.fundinfo.com. The issue and redemption prices and / or the net asset value (with the mention “excluding commissions”) of the Share classes distributed in  Switzerland:  www.swissfunddata.ch  and  www.fundinfo.com.  Bank  Lombard  Odier & Co Ltd is a bank and securities dealer authorised and regulated by the Swiss Financial Market Supervisory Authority (FINMA).United  Kingdom  –  This  document  is  a  financial  promotion  and  has  been  approved  for  the  purposes  of  Section  21  of  the  Financial  Services  and  Markets  Act  2000,  by Lombard Odier Asset Management (Europe) Limited. It is approved for distribution by  Lombard  Odier  (Europe)  S.A.,  London  Branch  for  Retail  Clients  in  the  United  Kingdom. The Sub-Fund is a Recognised scheme in the United Kingdom under the Financial Services and Markets Act 2000. UK regulation for the protection of retail clients  in  the  UK  and  the  compensation  available  under  the  UK  Financial  Services  Compensation  scheme  does  not  apply  in  respect  of  any  investment  or  services  provided   by   an   overseas   person.   UK   facilities   agent:   Lombard   Odier   Asset   Management  (Europe)  Limited.  Lombard  Odier  (Europe)  S.A.  UK  Branch  is  a  credit institution regulated in the UK by the Prudential Regulation Authority (PR A) and   subject   to   limited   regulation   by   the   Financial   Conduct   Authority   (FCA)   and   the   Prudential   Regulation   Authority   (PR A).   Details   of   the   extent   of   our   authorisation and regulation by the PR A and regulation by the FCA are available from us on request.Singapore – The Sub-Fund is not authorised or recognised by the Monetary Authority of Singapore (“MAS”) and the Shares are not allowed to be offered to the retail public in Singapore. Each Sub-Fund is a restricted scheme under the Sixth Schedule to the Securities  and  Futures  (Offers  of  Investments)  (Collective  Investment  Schemes)  Regulations of Singapore. This document can be transmitted only (i) to “institutional investors” pursuant to Section 304 of the Securities and Futures Act, Chapter 289 of Singapore (the “Act”), (ii) to “relevant persons” pursuant to Section 305(1) of the Act, (iii) to persons who meet the requirements of an offer made pursuant to Section 305(2) of  the  Act,  or  (iv)  pursuant  to,  and  in  accordance  with  the  conditions  of,  other  applicable exemption provisions of the Act.European Union Members: This marketing communication has been approved for issue by Lombard Odier (Europe) S.A. The entity is a credit institution authorised and regulated by the Commission de Surveillance du Secteur Financier (CSSF) in Luxembourg. Lombard Odier (Europe) S.A. branches are operating in the following territories:  France:  Lombard  Odier  (Europe).  S.A.  Succursale  en  France,  a  credit  institution   under   limited   supervision   in   France   by   the   Autorité   de   contrôle   prudentiel et de résolution (ACPR) and by the Autorité des marchés financiers(AMF) in respect of its investment services activities; Spain: Lombard Odier (Europe) S.A. Sucursal  en  España,  Lombard  Odier  Gestión  (España)  S.G.I.I.C.,  S.A.U.,  credit  institutions  under  limited  supervision  in  Spain  by  the  Banco  de  España  and  the  Comisión Nacional del Mercado de Valores (CNMV).United States: Neither this document nor any copy thereof may be sent, taken into, or distributed in the United States or given to any US person.This  marketing  communication  may  not  be  reproduced  (in  whole  or  in  part),  transmitted, modified, or used for any public or commercial purpose without the prior written permission of Lombard Odier. 

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