Juno Selection Fund: Q2 2019
Over 25% Performance over First Half of 2019
The Hague – July 2019 – The Juno Selection Fund has ended the second quarter of 2019 with a positive result of 2.8%. The value of a participation in the Juno Selection Fund has achieved a level of €386.66 as of June 30, 2019, an increase of 25.4% since the beginning of the year.
Since its inception in January 2008, the fund has now generated a CAGR of +12.5% per annum (total return + 287%). The Juno Selection Fund demonstrates a clear outperformance compared to the market in general. Since January 2008, the Dutch AEX, dividends reinvested, has achieved a CAGR of +4.6% per annum. The EMIX Smaller Europe Index increased by +5.7% per annum over the same period.
Our investment style is based on a highly concentrated portfolio of European (family-owned) companies, combined with a proven and rigorously applied valuation methodology. For years in a row, the group of companies selected by Juno show an annual earnings growth of 10-15% in aggregate. This earnings growth has been the driver behind the attractive share price performance we have achieved.
“Within the stock market we are increasingly seeing two extremes: good, but more cyclical companies with less predictable earnings growth that are trading at, what appear to be very attractive price-earnings ratios. On the other hand the proven, predictable growers, which are often trading at very high multiples, sometimes too high.”
Frans Jurgens, director and co-founder of Juno: “The current negative interest rate on European bonds should have led to astronomical price-earnings ratios for equities, if the historical inverse correlation between these two would be our guiding light. Instead, within the stock market we are increasingly seeing two extremes: good, but more cyclical companies with less predictable earnings growth that are trading at, what appear to be very attractive price-earnings ratios. On the other hand the proven, predictable growers, which are often trading at very high multiples, sometimes too high.”
Lennart Smits, director and co-founder of Juno: “It remains of great importance that we continue to apply our strict discipline in the valuation of our companies. Future earnings growth is essential, but not paying too much for that future earnings stream is probably just as important. Even though we have reduced some positions due to too high valuations, we still have enough attractively priced, annually growing companies in the portfolio. Companies that we expect to continue to be able to increase their earnings by 10% to 15% annually. We therefore look to the future with great confidence.”
Currently, the five largest holdings in the Juno Selection Fund are: SimCorp, Grenke, Technogym, Paradox and CTS Eventim.
About Juno Investment Partners
Juno Investment Partners is an independent asset manager based in The Hague. Juno invests in concentrated portfolios of high-quality European listed companies, often family-owned businesses or companies in which founders and directors are shareholders. The selection process emphasises predictable earnings growth, a high return on invested capital, low debt levels, strong margins and free cash flow, and a sustainable competitive advantage.
Launched in January 2008, the Juno Selection Fund focuses on small- and mid-cap European companies. The portfolio typically consists of around fifteen companies. Each is analysed intensively, and regular contact is maintained with management. The investment horizon is long, generally well over five years. Juno’s analysts, portfolio managers and employees also invest their personal capital in the JSF.
In addition to the JSF, Juno offers individually managed accounts through separate mandates, using the same investment approach. Juno holds an AIFM licence issued by the Dutch Authority for the Financial Markets (AFM).
