In this ‘fund in the spotlight’ article, Bethan James considers the Eden Tree Sustainable European Equity Fund which we hold in all of our Ethical portfolios.
About EdenTree:
EdenTree is an active investment management house dedicated to sustainable and impact investing – it’s all they do. They have a 35+ year track record in this space, having launched their first ethical fund in 1988.
EdenTree is part of the Benefact Group – a charity owned, international family of specialist financial services companies that give all available profits to charity and good causes.
What we like about this fund:
The EdenTree Sustainable European Equity Fund was launched in 1999 and has been managed by Chris Hiorns since 2007. It holds approximately 40-60 stocks across three broad themes: income accumulators, contrarian plays and hidden value.
• Income accumulators are defined as out-of-fashion businesses with strong free cash flows, operating in relatively mature industries.
• Contrarian plays are businesses suffering from short-term challenges, which they believe have the potential for recovery.
• Hidden value companies are those that have been overlooked by the market, which they believe have longer-term structural growth opportunities.
The EdenTree Sustainable European Equity Fund is an actively managed fund that aims to achieve long-term capital growth with an income by investing in a diversified portfolio of European companies, excluding the UK.
It seeks to invest at least 80% in companies that the manager classifies as sustainable, which are making a positive contribution to both people and the planet. In order to demonstrate this positive contribution, companies must pass their stringent sustainability assessment called the EdenTree Standard.
Growth of the Eden Tree Sustainable European Equity Fund:
Whilst the past is not a guarantee to future performance, this fund has grown over the last ten years by around 164.68%*. The fund has also enjoyed growth over the past 12 months of around +18.46%* which has certainly helped boost performance within our relevant Thomas and Thomas Ethical Portfolios.
Ratings that we look for:
We usually start by considering Morningstar and an FE Crown ratings. These offer us quantitative and qualitative analysis of a fund’s past performance, calculated from one to five stars. Morningstar and FE consider the skill of the fund manager in performance terms against their peer group over discrete rolling time periods. The Eden Tree fund has four of the available five-star rating from Morningstar and the maximum available rating from the FE Fundinfo Crown rating. This is certainly encouraging for us as a starting point before we consider deeper data.
Conclusion:
We currently hold this fund within all of our three Pro-Ethical client portfolios.
I personally like the fact that this fund does something to help our society, by investing in the companies that are genuinely making a difference and really contributes to our clients’ investment journey.
Please remember that past performance is not a guide to future performance. This article is not a recommendation to purchase the Eden Tree Sustainable European Equity Fund and is aimed at our clients who already hold the fund as further information. We never recommend an individual fund as each fund acts as a ‘blend’ alongside many others.
As always, we are here for you 100% if you have any concerns or questions at all.
My best wishes
Beth
*According to figures from EdenTree and Morningstar. Updated on a regular basis.
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