Juno Continuation Fund – A Remarkable Start
The Hague – April 2020 – On 1 February this year, the Juno Continuation Fund was launched. This new fund, managed by Juno Investment Partners, will apply the successful investment style of the Juno Selection Fund, which closed for investors in 2018. The Continuation fund is identical in almost all respects to the Selection fund, but focuses on investments in European (family-owned) companies that are one size up compared to the Selection Fund. Juno is delighted and proud to announce that the Fund had over 80 participants at launch date and that this number has been steadily increasing since.
Since its launch date, the Juno Continuation Fund did suffer from the effects of the COVID-19 virus as well and ended the first quarter of 2020 with a net asset value of €87.80 per participation, a decrease of -12.2% since the start of the fund on February 1. Over this period, the MSCI Europe Mid Cap Index lost -24.7% and the AEX (dividend reinvested) also fell sharply by -18.1%.
The pandemic that is currently gripping the world also affects some of the companies selected by Juno. Rob Deneke, director and co-manager of the Juno Continuation Fund: “Although affected by current developments, it is clear that the capability to withstand the current situation is above average for the majority of our companies. The products and services they provide are often essential for their customers, as a result of which the demand for these products and services often continues. In addition, our companies are financed conservatively so that their survival is not in jeopardy and they remain able to make the necessary investments, usually from their own resources, as and when necessary”.
Frans Jurgens, director and co-founder of Juno: “It is not our expertise to make macroeconomic forecasts, but we strongly believe that once this pandemic is behind us, it will leave a very deep scar in the economy. Fortunately, there are also companies that are barely affected and even a few that will take advantage of the current circumstances. We were able to act on share price weakness and selectively increase the holding of those companies in our portfolio”.
Lennart Smits, director and co-founder of Juno: “The timing of the launch of the Juno Continuation Fund meant that the Fund had a fairly high cash position of around 30%, which has certainly helped us over the past period. But especially the low dependency on economic cycles, a core selection criterion at Juno, makes our companies less vulnerable. We also benefited from the healthy financial structures of our companies: where cash on the balance sheet still cost money a few months ago and caused derision from bankers, our (family-owned) companies now hold the trump cards. Juno will try to continue to make smart, selective and disciplined use of the high volatility in the markets to get the cash we hold in the portfolio today back to work”.
About the Juno Continuation Fund and Juno Investment Partners
The Juno Continuation Fund invests in shares of extraordinary, medium-sized European companies with a market value between 4 and 20 billion at the time of initial purchase. Often, these are family-owned businesses. Companies that can continue to achieve predictable and stable earnings growth are considered for investment. The selection process focuses on the return on invested capital, low debt levels and free cash flows with a highly predictable character. Our analysts / portfolio managers put together a highly concentrated portfolio of companies that they themselves identify, analyze and regularly visit. We clearly have a long term investment horizon and expect to hold on to portfolio positions for a long period of time (more than five years).
The Juno Continuation Fund is managed by Juno Investment Partners. Juno Investment Partners has an AIFM license (as referred to in article 2:65 Wft), granted by the Dutch Financial Markets Authority (“AFM”).
Juno Investment Partners is also the manager of the Juno Selection Fund which is currently closed for investment. The Selection Fund focuses on listed (family-owned) companies with a market value that is lower than the focus of the Continuation Fund (250 million-4 billion Euro and 4-20 billion Euro, respectively), with the same investment style.
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