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Invesco Perpetual European ex UK Enhanced Index Fund

April 2017 (Content as at 31 March 2017)

You can currently only invest in this fund via a qualified financial adviser or a third party fund platform.


The companies we look for

In today’s world of low-returns, every little extra, in performance terms, helps.

The Invesco Perpetual European ex UK Enhanced Index Fund seeks to capture both the return of the MSCI Europe ex UK index, and achieve an additional return, while maintaining a similar level of risk over a full market cycle (5 - 10 years).

The fund managers look to identify the factors that have the potential to drive excess returns, and thereby generate meaningful outperformance.

Fund holdings

Typical number of stocks in the fund: c150

The stocks held in the fund will primarily be those of the MSCI Europe ex UK index, which currently comprises 334 stocks1, although there is flexibility for a proportion of the stocks held in the fund to be from outside of this index.

1 MSCI, as at 29 July 2016.

Overview

Objective

The Invesco Perpetual European ex UK Enhanced Index Fund aims to achieve long term capital growth and outperform the MSCI Europe ex UK Index (net total return) (the “Index”) by investing primarily in a portfolio of investments in European companies, excluding the UK. The fund aims to outperform the Index net of fees over a full market cycle (typically 5-10 years). There is no guarantee that the fund will achieve its target and an investor may not get back the full amount invested. The fund seeks to achieve its objective following a systematic investment process, with a high correlation to the Index. The fund uses a range of factors to evaluate the relative attractiveness of a stock together with an assessment of risk, to build a portfolio that shares the broad characteristics of the Index. The fund is actively managed and will not replicate the Index in its entirety. The fund will primarily invest in equities, and may also invest in cash, cash equivalents, money market instruments, warrants, collective investment schemes and other transferable securities. The fund may enter into financial derivative instruments for efficient portfolio management purposes only.

Fixed interest roundtable Q&A: where next for bond markets?

Video

15 July 2015

Invesco Perpetual Fixed Interest team

In this live roundtable with fund managers from our Fixed Interest team, they discussed key issues including whether the Greek debt crisis matters for bond markets and the current macroeconomic backdrop.

Market commentary

Equity markets in the Eurozone rose in March underpinned by strong macroeconomic data. The Eurozone economy continued to come out with solid data points and beat expectations. Euro-area unemployment fell to the lowest level in almost eight years. The region’s Purchasing Managers’ Index, a survey of private sector activity and a leading indicator for economic growth, maintained its upward trend and rose to a 71-month high in March. On an industry level, the utilities sector was the strongest performer as rebounding commodity prices and declining oversupply provided a lifeline to European utilities. Meanwhile, the healthcare sector was the biggest laggard relative to the broader market, yet it still recorded positive returns. The European Central Bank kept its monetary policy unchanged in March. In the Netherlands, the country’s liberal party won the election comfortably and recent polls revealed that Macron will defeat Le Pen in the French presidential race.

Fund strategy

The performance of the fund is generated through a systematic factor based investment process driven by four concepts: Earnings Expectations, Market Sentiment, Management & Quality and Value. Relative risk is controlled with the help of an optimiser, an analysis tool that recommends trades to maximise portfolio exposure to the selected stocks within pre-determined risk/return parameters. In terms of portfolio construction, we tightly constrain the risk taken at sector, industry, country and currency level. Our diversified approach to stock selection favours companies that, in our view, are attractively valued and have good earnings and price momentum and evidence that management supports shareholder value.

Key facts
Product type ICVC
Launch date 28 July 2016
Fund size £4.34m
Historic yield 2.76%
Available in an ISA? Yes

Fund manager

Thorsten Paarmann

Title: Portfolio Manager
Team: Invesco Quantitative Strategies

Alexander Uhlmann

Title: Director Portfolio Management
Team: Invesco Quantitative Strategies
Fund details
Fund currency GBP
Trading frequency Daily
Accounting period ends 31 October
30 April
Share types
SEDOL ISIN
Accumulation (No Trail) BZ8GWH5 GB00BZ8GWH52
Income (No Trail) BZ8GWJ7 GB00BZ8GWJ76
Y (Acc) BZ8GWK8 GB00BZ8GWK81
Y (Inc) BZ8GWL9 GB00BZ8GWL98
Z (Acc) BZ8GWN1 GB00BZ8GWN13
Z (Inc) BZ8GWP3 GB00BZ8GWP37
Investment levels
Minimum monthly amount £20
Minimum additional lump sum £100
Maximum fund charges
Initial charge 5%
Exit charge None

Performance

Charges

One-off charges taken before you invest

Entry charge

The entry charge for the fund is up to 5%. This is the maximum that might be taken out of your money before it is invested. For example, if you invest £1,000, an entry charge of 5% means £950 of your money will be used to buy shares in the fund.

The entry charge covers the costs of setting up your investment.

If you invest through a third party (such as a financial adviser), but do not receive financial advice on your investment, this charge may include payments to that third party. For more details see "What share classes are available for your ICVC funds?".

Exit charge

There is no exit charge for the fund.

Charges taken from the fund over a year

Ongoing charge

The ongoing charge figure is based on a fixed, all-inclusive fee and excludes portfolio transaction costs. The ongoing charge for each share class can be found in the relevant Key Investor Information Document available under 'Literature'. Investors will be provided with advance notice if any increases to this figure occur.

The ongoing charge covers all aspects of operating the fund during the year, including fees paid for investment management, administration and the independent oversight functions.

If you invest through a third party (such as a financial adviser), but do not receive financial advice on your investment, this charge may include payments to that third party. Once invested, your contract note or acknowledgement letter will show the amount of any payment in cash terms. For more details see "What share classes are available for your ICVC funds?".

Charges taken from the fund under specific conditions

Performance fee

No performance fee is charged.

Portfolio transaction costs

On average, since the launch of the fund on 28 July 2016, the fund incurred broker commissions of 0.02% and transfer taxes of 0.05%, as a necessary part of buying and selling the fund's underlying investments in order to achieve the investment objective. A proportion of these costs is recovered directly from investors joining and leaving the fund.

When the fund buys or sells shares, broker commissions and transfer taxes are paid by the fund on each transaction. In addition, there is a dealing spread between the buying and selling prices of the underlying investments. Unlike shares, other types of investments (such as bonds, money market instruments and derivatives) have no separately identifiable transaction costs; these costs form part of the dealing spread. Dealing spreads vary considerably depending on the transaction value and market sentiment. The estimated average dealing spread for the fund is 0.05% of the transaction value.

Comparing portfolio transaction costs for a range of funds may give a false impression of the relative costs of investing in them, for the following reasons:

  • Transaction costs do not necessarily reduce returns. The net impact of dealing is the combination of the effectiveness of the manager's investment decisions in improving returns and the associate costs of investment
  • Historic transaction costs are not an effective indicator of the future impact on performance
  • Transaction costs for buying and selling investments due to other investors joining or leaving the fund may be recovered from those investors. For further information see Pricing policy note below
  • Transaction costs vary from country to country
  • Transaction costs vary depending on the types of investment in which a fund invests
  • As the manager's investment decisions are not predictable, transaction costs are also not predictable

Pricing policy note

We operate a single pricing methodology for this fund and reserve the right to adjust the fund's price to protect your investment from the costs of buying and selling investments that result from other investors joining or leaving the fund. The amount of any such adjustment is calculated by reference to the estimated costs of dealing in the underlying investments, including any dealing spreads, broker commissions and transfer taxes.

Typical adjustments to the fund's price are to increase it by 0.10% for net inflows or decrease it by 0.05% for net outflows.

We usually adjust the price to the maximum extent possible when the value of net contributions or withdrawals is significant, which helps to protect your investment from the costs of the resultant transactions.

1The fund's financial year end is 31 October 2016. Figures in these sections are as at 31 October 2016.

 

Holdings

 

Literature

Factsheets

Invesco Perpetual European ex UK Enhanced Index Fund Factsheet  (164 KB)

KIIDs

Invesco Perpetual European ex UK Enhanced Index Fund KIID acc (No trail)  (195 KB)

Invesco Perpetual European ex UK Enhanced Index Fund KIID acc (Y)  (194 KB)

Invesco Perpetual European ex UK Enhanced Index Fund KIID acc (Z)  (194 KB)

Invesco Perpetual European ex UK Enhanced Index Fund KIID inc (No trail)  (195 KB)

Invesco Perpetual European ex UK Enhanced Index Fund KIID inc (Y)  (195 KB)

Invesco Perpetual European ex UK Enhanced Index Fund KIID inc (Z)  (194 KB)

Application form

ICVC & ISA Application booklet 17/18  (190 KB)

Product & fund information

ICVC Supplementary Information Document (SID)  (4 MB)

Brochures

Invesco Perpetual Enhanced Index funds brochure  (124 KB)

Financial reports

Invesco Perpetual European Investment Series Annual Report 2016 (Long Form)  (1 MB)

Invesco Perpetual European Investment Series Annual Report 2016 (Short Report)  (352 KB)

Forms

ISA Additional Permitted Subscription application form  (69 KB)

Fund updates

Invesco Perpetual European ex UK Enhanced Index Fund Infosheet  (149 KB)

European Equites: update and outlook for 2016

Audio

18 November 2015

Jeff Taylor, Head of European Equities, Invesco Perpetual and Stephanie Butcher, European Equities Fund Manager, Invesco Perpetual

What is the outlook for European equity markets? Does China have the potential to derail a European recovery? Where are the opportunities in 2016?

European equities – 2017 investment outlook

Video

07 December 2016

Jeff Taylor, Head of European Equities, Invesco Perpetual

European equities remain unloved after a volatile 2016, but what can we expect going into 2017?

Brexit – the pros and cons

Article

04 August 2015

John Greenwood, Chief Economist, Invesco Ltd

The British public will soon have a chance to vote in the “in-out” referendum on continued membership of the European Union? Will the economic benefits of staying in the European project outweigh the costs? If the UK does decide to leave, what are the options available?

Investment risks

The value of investments and any income will fluctuate (this may partly be the result of exchange rate fluctuations) and investors may not get back the full amount invested. Past performance is not a guide to future returns.

The fund may use derivatives (complex instruments) in an attempt to reduce the overall risk of its investments, reduce the costs of investing and/or generate additional capital or income, although this may not be achieved. The use of such complex instruments may result in greater fluctuations of the value of the fund. The Manager, however, will ensure that the use of derivatives within the fund does not materially alter the overall risk profile of the fund.

Important information

Yield and performance figures are based on the z (accumulation) share class.

All fund portfolio figures are as at date shown (source: Invesco Perpetual).

Where there is insufficient historical data available to calculate the historic yield we have shown an estimated yield, using the most appropriate basis of calculation. It does not include any entry charge and investors may be subject to tax on their distributions.

Where Invesco Perpetual has expressed views and opinions, these may change. Where securities are mentioned they do not necessarily represent a specific portfolio holding and do not constitute a recommendation to purchase, hold or sell.

For the most up to date information on our funds, please refer to the relevant fund and share class-specific Key Investor Information Documents, the Supplementary Information Document, the Annual or Interim Short Reports and the Prospectus, which are available using the contact details shown.