Juno Selection Fund ends in the green after the first six months

• Juno Selection Fund achieves positive result in first half year, despite crisis
• Manager intervenes “unusually hard” in portfolio
• Equity positions that may emerge more strongly from the pandemic crisis have been increased
• Underlying investments are expected to achieve solid earnings growth again in 2020

The Hague – July 2020 – During the second quarter, the Juno Selection Fund was able to fully make up for the losses of the first three months of the year. With a return of +19.8% over the three months to July, the fund shows a positive performance of +0.8% for the full year 2020, despite the COVID 19- pandemic. Juno’s investment style appears to be successful even in an economic headwind.

The fund’s return continues to be well ahead of European equity markets, which are more heavily  affected by the current economic conditions. After six months, the AEX (with reinvested dividend) stands at a loss of -6.3% for 2020, while the index of small to medium-sized European companies, the EMIX Smaller Europe, has even lost -14.5% since the beginning of the year.

Lennart Smits, director and co-founder of Juno: “We saw in the news that almost all companies that filed for bankruptcy in recent months had large amounts of debt on their balance sheets. Juno has always had very strict selection criteria for the companies it includes in their portfolios. One of those criteria is that these companies should be barely, if at all, burdened with debt capital, because in our view this always has an important risk-increasing effect. Due to the strict selection, our portfolio is clearly more resistant to economically uncertain times, especially in combination with the predictable earnings growth of these companies, another important criterion. ”

Juno also has a strong preference for family-owned businesses, one of the reasons being their prudent management style with a genuine focus on the long term. It is especially in times of economic challenges that Juno sets itself apart from the market. The Juno Selection Fund’s investment style has proven very successful since its inception in January 2008. In total, the fund generated an average of +12.1% per annum. The aforementioned EMIX Smaller Europe index for small and medium-sized European companies shows a return of +4.8% over the same period (since 2008).

Frans Jurgens, director and co-founder of Juno: “Obviously, not all of Juno’s companies are immune to the problems caused by the lockdown and economic uncertainty that ensues. At the beginning of the year, we had therefore already intervened unusually hard in the portfolio. Investments in companies that, in our opinion, would emerge well or even stronger from the pandemic crisis were strengthened. We also see that our financially strong (family-owned) companies are using the current situation to further expand their strong market positions. Looking at our selection of companies in the portfolio, we expect 2020 to be another year of generating attractive earnings growth. We know from the past that in the long term we will see this earnings growth reflected in higher share prices ”.

The manager of the Juno Selection Fund continues to patiently and closely monitor the markets and companies in order to be able to use the available cash position carefully at the right time.

The quarterly report can be found here and the most recent factsheet here.

About Juno Investment Partners

Since 2007, Juno Investment Partners has been investing in a highly concentrated portfolio of European listed companies with predictable and stable earnings growth, often family-owned businesses.

We focus on companies with a high return on invested capital, strong margins, and highly predictable (free) cash flows. These are typically companies with a strong competitive position and clear added value for their clients, enabling them to continue creating value over the long term.

Based on these characteristics, we select a limited number of companies that we want to understand thoroughly. The portfolio consists of approximately fifteen companies. These are analyzed intensively, visited regularly, and monitored over several years. The investment horizon is long, typically well over five years. Our analysts and portfolio managers also invest in the funds themselves.

Juno offers three products. The Juno Selection Fund focuses on small and medium-sized companies. The Juno Continuation Fund focuses on medium-sized companies. In addition, Juno offers individual asset management via managed accounts, using the same investment approach. The Juno Selection Fund was launched in 2008 and invests in European companies with an initial market capitalization between €250 million and €4 billion. The fund was closed to new investments for a long time and has been accessible to existing participants again since April 2023.

The Juno Continuation Fund was launched on February 1, 2020, and invests in medium-sized companies with a market capitalization between €4 and €20 billion. Here, too, the emphasis is on companies that often have family or management as co-shareholders.

Juno holds an AIFM license from the AFM.