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Best and Worst: European Unit Trusts

Nic Cicutti
Saturday 09 July 1994 18:02 EDT
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INVESTING in Europe has not delivered many happy returns to savers over the past six months, and even fewer to those putting their money in specialist funds that focus on single countries.

Despite significant gains for all but one fund invested in Europe in the year to July, the more recent past has been decidedly shakier. If pounds 100 had been invested on New Year's Day in the average European unit trust, it would now be worth only pounds 93.59.

Overall, only 11 funds are ahead so far this year. Of those, five are used as hedge funds by investment companies as a cushion against possible heavy losses.

The heaviest losses were suffered by a number of funds invested narrowly in Germany, France or Spain.

A Capital House spokesman said single-market funds, which are more likely to be volatile, either perform extremely well or not at all.

'The German economy has been quite fragile in the past few months. Because US interest rates have been creeping up, this has reduced confidence in the likelihood of reductions in Germany.'

Martin Currie's Europe fund recorded a loss of 11.88 per cent. Martin Gibson, a director, said: 'The European market held up quite well until about April, when it started to fall quite sharply. There has been a reluctance of US investors to come in, and there is no buying power.'

Mr Currie's own fund performed badly because it was more exposed to the financial sector. It is now shifting to more cyclical manufacturing and industrial stocks, to take advantage of any recovery in the market.

----------------------------------------------------------------- EUROPEAN UNIT TRUST ----------------------------------------------------------------- The best pounds 1 Dimensional European Small Companies. . . . . . . . 103.93 2 HTR European Special Situations. . . . . . . . . . .103.68 3 Providence Capitol European. . . . . . . . . . . . .101.82 4 Morgan Grenfell Europa. . . . . . . . . . . . . . . 101.63 5 Invesco European Smaller Companies. . . . . . . . . 101.23 119 Martin Currie European. . . . . . . . . . . . . . .88.12 120 GT Germany. . . . . . . . . . . . . . . . . . . . .88.18 121 Invesco French Growth. . . . . . . . . . . . . . . 86.54 122 CH German. . . . . . . . . . . . . . . . . . . . . 86.08 123 Baring German Growth. . . . . . . . . . . . . . . .82.29 ----------------------------------------------------------------- The table shows the value of pounds 100 invested over six months to July 1, offer to bid, with net income reinvested. Hedge funds have been removed from figures. Source: Micropal -----------------------------------------------------------------

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