European Assets Trust is an investment company specialising in small and mid-cap companies in Europe. It is managed by Paras Anand and Sam Cosh at F&C Investments in London. Unusually for a smaller company specialist, European Assets Trust aims to pay a high yield to investors, currently calculated as 6% of net assets at the 31 December year-end.
In the six months to the end of June, the Company's net asset value ("NAV") total return per share was 12.5% in Sterling terms and 6.8% in Euros, which compares favourably with the total return from the benchmark index, the HSBC European Smaller Companies ex-UK, which was 5.4% in Sterling terms and was flat in Euro terms.
Dividends of €0.17 per share were paid in January and May 2011 and a further dividend will be paid in August 2011 of €0.1937 per share. This will result in total dividends paid for the year of €0.5337 per share, representing the full 6% annual dividend payment to shareholders.
Commenting on the outlook, fund manager Paras Anand said: "Leading into 2011, we have had two years of strong performance from equities, as the market recovered from the lows of March 2009. Abundant liquidity, emerging market growth and restocking, factors which have been instrumental in driving this recovery, have all but played out. Liquidity is slowly being withdrawn; we have seen the end of the second round of quantitative easing from the US and we have seen an increase in interest rates from the European Central Bank. Restocking is over and emerging market growth is slowing, albeit from very high levels to arguably something more sustainable. We are however optimistic for European small cap equities, not least, as argued above, because sentiment is so poor and the valuations so attractive."
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