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View NowPast performance does not predict future returns. You may get back less than you originally invested. Reference to specific securities is not intended as a recommendation to purchase or sell any investment.
Key takeaways
- European equities finished December on a firm footing, supported by improving sentiment and expectations of policy stability into 2026.
- Both the long and short books contributed positively to performance
- Financials were a key driver of long book performance, led by IG Group which extended its share buyback programme and delivered a strong trading update.
Performance
The Fund’s A4 share class returned 2.8%* in euro terms in December. The Fund’s comparator benchmarks, the MSCI Europe Index and HFRX Equity Hedge EUR Index, returned 2.7% and 0.7% respectively.
Commentary
European equities ended December on a constructive note, with the market supported by improving macro sentiment and expectations for policy stability into 2026. The European Central Bank kept rates unchanged and reiterated a careful stance as inflation cools and growth remains fragile. Elsewhere, US markets absorbed a quarter-point Fed cut, but a more cautious outlook on further easing left rate expectations finely balanced into 2026.
European markets were led by financials (+6.6%), alongside solid contributions from materials (+4.0%), industrials (+3.0%) and consumer discretionary (+2.2%), with more modest gains from information technology (+1.4%) and healthcare (+1.2%). The weakest segments were energy (-1.4%), consumer staples (-0.9%) and real estate (--0.7%).
Both the long book (c.107% of Fund NAV) and the short book (c.32%) contributed positively over the period, helping the Fund outperform the benchmark.
Financials have been a key driver of Fund performance over the year and again delivered strong returns in December, with several positions among the best-performing long holdings. IG Group (+16%), UniCredit (+11%), Banco Santander (+9.0%) and Caixabank (+8.6%) all performed well.
Trading platform IG Group (+16%) extended its share buyback by £75 million and reported a strong quarterly trading update. Organic trading revenue rose 29% to £270.7 million (three months to end-November), with growth broad-based across products.. In the US, Tastytrade net trading revenue increased 51% to $65.3 million, while stock trading and investments accelerated, supported by the commission-free offer and the inclusion of Freetrade since its April acquisition.
Away from the financials sector, Danish shipping giant AP Moller-Maersk (+13%) and Wartsila (+8.6%), the Finnish provider of technologies and lifecycle solutions for the marine and energy markets, also ranked among the top performers following a ratings upgrade from a covering analysts.
AJ Bell (-18%) fell as full-year results, while solid, came in slightly below expectations. Pre-tax profit rose 22% to £137.8 million and revenue increased 18% to £317.8 million, but investors focused on higher costs and margin guidance. Administrative expenses climbed 18% to £184.7 million, driven by increased distribution spend (largely advertising/marketing) and a 17% rise in technology costs to £55.1 million. The company also cautioned that revenue margins are likely to ease slightly next year after elevated FX dealing activity.
Discrete years' performance (%) to previous quarter-end**:
| Dec-25 | Dec-24 | Dec-23 | Dec-22 | Dec-21 |
Liontrust GF European Strategic Equity A4 Acc EUR | 4.1% | 18.5% | 1.4% | 18.3% | 32.9% |
MSCI Europe | 19.4% | 8.6% | 15.8% | -9.5 | 25.1% |
HFRX Equity Hedge EUR | 7.8% | 6.2% | 4.7% | -5.2% | 11.0% |
| Dec-20 | Dec-19 | Dec-18 | Dec-17 | Dec-16 |
Liontrust GF European Strategic Equity A4 Acc EUR | -10.0% | 23.2% | -7.1% | 4.2% | 4.8% |
MSCI Europe | -3.3% | 26.0% | -10.6% | 10.2% | 2.6% |
HFRX Equity Hedge EUR | 2.9% | 8.5% | -12.3% | 7.8% | -1.7% |
*Source: Financial Express, as at 31.12.25, total return (income reinvested and net of fees).
**Source: Financial Express, as at 31.12.25, total return (income reinvested and net of fees). Investment decisions should not be based on short-term performance.
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KEY RISKS
Past performance does not predict future returns. You may get back less than you originally invested.
We recommend this fund is held long term (minimum period of 5 years). We recommend that you hold this fund as part of a diversified portfolio of investments.
- 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.
- The Fund will invest in derivatives but it is not intended that their use will materially affect volatility. Derivatives are used to protect against currencies, credit and interest rate moves or for investment purposes. The use of derivatives may create leverage or gearing resulting in potentially greater volatility or fluctuations in the net asset value of the Fund. A relatively small movement in the value of a derivative's underlying investment may have a larger impact, positive or negative, on the value of a fund than if the underlying investment was held instead.
- The Fund’s volatility limits are calculated using the Value at Risk (VaR) methodology. In high interest rate environments the Fund’s implied volatility limits may rise resulting in a higher risk indicator score. The higher score does not necessarily mean the Fund is more risky and is potentially a result of overall market conditions.
- Credit Counterparty Risk: the Fund uses derivative instruments that may result in higher cash levels. Outside of normal conditions, the Fund may choose to hold higher levels of cash. Cash may be deposited with several credit counterparties (e.g. international banks) or in shortdated bonds. A credit risk arises should one or more of these counterparties be unable to return the deposited cash.
- Liquidity Risk: the Fund may encounter liquidity constraints from time to time. The spread between the price you buy and sell shares will reflect the less liquid nature of the underlying holdings.
- ESG Risk: there may be limitations to the availability, completeness or accuracy of ESG information from third-party providers, or inconsistencies in the consideration of ESG factors across different third party data providers, given the evolving nature of ESG.
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.
DISCLAIMER
This material is issued by Liontrust Investment Partners LLP (2 Savoy Court, London WC2R 0EZ), authorised and regulated in the UK by the Financial Conduct Authority (FRN 518552) to undertake regulated investment business.
It 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.
This information and analysis 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, no representation or warranty is given, whether express or implied, by Liontrust as to its accuracy or completeness, including for external sources (which may have been used) which have not been verified.
This is a marketing communication. Before making an investment, you should read the relevant Prospectus and the Key Investor Information Document (KIID) and/or PRIIP/KID, which provide full product details including investment charges and risks. These documents can be obtained, free of charge, from www.liontrust.com or direct from Liontrust. 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.
