Liontrust GF European Smaller Companies

The Fund’s A3 share class returned 1.1%* in euro terms in September. This Fund’s target benchmark, the MSCI Europe Small Cap Index, returned 0.5%.

Newsflow in equity markets leading into the month was primarily focused on the widely anticipated US interest rate decision – with the US Federal Reserve pushing ahead towards the end of September with a 50 basis point cut, providing a lift to market sentiment. This development was soon followed by a series of stimulus measures from China in a further boost to investor confidence; however, concerns over geopolitical risks, especially the ongoing conflict in the Middle East, added some volatility to markets towards the end of the month. In Europe, having kept interest rates on hold in its July meeting, the European Central Bank (ECB) cut rates by 25 basis points in September, citing that data indicated a softening of inflation over the period.

The MSCI Europe Index lagged both its US and UK peers in September, with the energy (-7.3%), healthcare (-6.9%) and information technology (-2.8%) among the largest fallers. Among sectors to post a positive return were materials (+5.1%), real estate (+4.7%) and information technology (-2.8%).

Shares in gambling software company Playtech (+15%) continued their ascent following news last month that it was in talks with Flutter Entertainment Plc on the potential sale of its Italian unit, Snaitech. Building on this momentum, Playtech upgraded its 2024 adjusted earnings forecasts to be slightly ahead of current consensus expectations, mainly driven by a strong performance within its B2B division. Furthermore, investors reacted well to the news that Playtech had struck a revised deal with Mexican gambling operator Caliente Interactive over its joint venture Caliplay.

Gamma Communications (+11%) shares rose after the company said it is considering moving its listing to London's main market, while it also posted robust first-half earnings. Gamma reported a pre-tax profit for the half year of £48.5 million compared with £43.5 million for the comparable period a year earlier. For the year as a whole, the company said it expects adjusted earnings to be in the top half of expectations, with the company continuing to view M&A as a key tool to complement its organic growth, broaden its capabilities.

Shares in UK property listing portal Rightmove (+13%) rose sharply after receiving an initial takeover offer from Australian real estate listing provider REA Group. After rejecting an initial offer of 705p, a 27% premium to the UK company’s prior share price , Rightmove rebuffed three further offers. REA subsequently abandoned its attempt of a takeover on the final day of the month having failed to win over the UK property portal’s board. Following the abandonment, Rightmove gave back some of its share price appreciation.

While corporate newsflow was light over the month, Dutch geological data company Fugro (-9.4%) and Danish jewellery producer Pandora (-6.6%) were among the largest detractors to performance.

Shares in German HR software company Atoss Software (-6.5%) fell after the company’s founder sold shares.

Positive contributors to performance included:

Playtech (+17%), Gamma Communications (+11%), Rightmove (+13%)

Negative contributors to performance included:

Fugro (-9.4%), Pandora (-6.6%), Atoss Software (-6.5%)

Discrete years' performance (%) to previous quarter-end:

*Source: Financial Express, as at 30.09.24, total return (net of fees and income reinvested).

**Source: Financial Express, as at 30.09.24, total return (net of fees and income reinvested). Discrete data is not available for ten full 12-month periods due to the launch date of the portfolio (01.02.17). Investment decisions should not be based on short-term performance.

KEY RISKS

Past performance is not a guide to future performance. The value of an investment and the income generated from it can fall as well as rise and is not guaranteed. You may get back less than you originally invested.

The issue of units/shares in Liontrust Funds may be subject to an initial charge, which will have an impact on the realisable value of the investment, particularly in the short term. Investments should always be considered as long term.

Overseas investments may carry a higher currency risk. They are valued by reference to their local currency which may move up or down when compared to the currency of the Fund. This Fund may have a concentrated portfolio, i.e. hold a limited number of investments. If one of these investments falls in value this can have a greater impact on the Fund's value than if it held a larger number of investments. As the Fund is primarily exposed to smaller companies there may be liquidity constraints from time to time, i.e. in certain circumstances, the fund may not be able to sell a position for full value or at all in the short term. This may affect performance and could cause the fund to defer or suspend redemptions of its shares. In addition the spread between the price you buy and sell units will reflect the less liquid nature of the underlying holdings. Outside of normal conditions, the Fund may hold higher levels of cash which may be deposited with several credit counterparties (e.g. international banks). A credit risk arises should one or more of these counterparties be unable to return the deposited cash. Counterparty Risk: any derivative contract, including FX hedging, may be at risk if the counterparty fails.

DISCLAIMER

This is a marketing communication. Before making an investment, you should read the relevant Prospectus and the Key Investor Information Document (KIID), which provide full product details including investment charges and risks. These documents can be obtained, free of charge, from www.liontrust.co.uk or direct from Liontrust. Always research your own investments. If you are not a professional investor please consult a regulated financial adviser regarding the suitability of such an investment for you and your personal circumstances.

This should not be construed as advice for investment in any product or security mentioned, an offer to buy or sell units/shares of Funds mentioned, or a solicitation to purchase securities in any company or investment product. Examples of stocks are provided for general information only to demonstrate our investment philosophy. The investment being promoted is for units in a fund, not directly in the underlying assets. It contains information and analysis that is believed to be accurate at the time of publication, but is subject to change without notice. Whilst care has been taken in compiling the content of this document, no representation or warranty, express or implied, is made by Liontrust as to its accuracy or completeness, including for external sources (which may have been used) which have not been verified. It should not be copied, forwarded, reproduced, divulged or otherwise distributed in any form whether by way of fax, email, oral or otherwise, in whole or in part without the express and prior written consent of Liontrust.