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European Equity Fund

Style agnostic, focus on quality to maintain a balanced portfolio.

ISIN LU0285831334 Valoren 3253501

3YR Return Annualised
(View Total Returns)

Total Assets


1YR Return
(View Total Returns)

Manager Tenure


Information Ratio
(5 Years)

Tracking Error
(5 Years)


Inception Date 26-Feb-2007

Performance figures calculated in EUR

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30-Apr-2020 - Dean Tenerelli, Portfolio Manager,
Policymakers have responded forcefully to counter the economic impact of the coronavirus. This has helped most asset classes including European equities claw back some losses after precipitous declines. However, we continue to face a severe economic and social shock, which may well endure beyond the current consensus. We are working with our analysts to identify where we can buy better-quality businesses at even more attractive prices.
Dean Tenerelli
Dean Tenerelli, Portfolio Manager

Dean Tenerelli is portfolio manager in the Equity Division at T. Rowe Price. He manages the Europe Equity Strategy, a position he has held since October 2005, and is chairman of its Investment Advisory Committee. He is a vice president of T. Rowe Price Group, Inc. and T. Rowe Price International Ltd.

Click for Manager Outlook


Manager's Outlook

Markets and investors are facing one of the most uncertain and challenging environments in modern times. Both the depth and duration of the crisis caused by the outbreak of the novel coronavirus are unknown.

Policymakers have started to respond forcibly, in both monetary and, increasingly, fiscal terms. Most asset classes have declined precipitously, including European equities. We recognize the severity of the economic and social shock that we are facing-and it may well endure beyond the current consensus.

However, many companies' valuations have compressed dramatically, and we find that we are being presented with some real opportunities when we assess their estimated longer-term fundamental value. We have moved from a position at the start of the year when very few companies offered an attractive valuation to one now where some good and very good companies appear "cheap."

Although the scale of market declines has been painful, our relative performance has been quite resilient. That our portfolio has proven to be quite well suited to the environment is attributable, we believe, to our focus on higher-quality companies, biased toward lower leverage and strong competitive advantages, acquired at conservatively derived relative valuations.

We are working with our analysts to identify better-quality businesses at even more attractive prices. Specific stocks that are currently of interest can be found across many industries, ranging from luxury goods, industrials, selectively in energy and materials, and even in consumer staples after their derating.

Investment Objective

To increase the value of its shares, over the long term, through growth in the value of its investments. The fund invests mainly in a diversified portfolio of stocks of European companies.

Investment Approach

  • Fundamental research is critical to successfully identify and assess long-term investment opportunities. We look for companies with high returns on capital and capable of providing sustainable earnings across the market cycle.
  • Style agnostic, focus on quality. By avoiding style constraints, we can invest in quality companies and maintain a balanced portfolio through market cycles.
  • Disciplined approach to valuation. We aim to buy businesses at a clear discount to their intrinsic value.
  • Risk management is essential and is assisted by diversification, quantitative analysis, and automatic stabilizers built into our investment process.

Portfolio Construction

  • Typically 50-80 stocks
  • Individual position size up to 4.0% relative to the indicative benchmark
  • Sector ranges: typically +/- 10% relative to the indicative benchmark
  • Country ranges: typically +/- 10% relative to the indicative benchmark
  • Expected Tracking Error: typically 3.0% to 6.0%
  • Information Ratio objective: >0.5
  • Cash target range: fully invested, typically less than 5.0%
  • Turnover range: 40%-100%

Performance (Class I)

Annualised Performance

  1 YR 3 YR
5 YR
10 YR
Since Manager Inception
Fund % -4.22% 1.05% 0.41% 7.56% 9.21%
Indicative Benchmark % -11.58% -1.78% -0.56% 5.36% 7.22%
Excess Return % 7.36% 2.83% 0.97% 2.20% 1.99%

Inception Date 26-Feb-2007

Manager Inception Date 06-May-2009

Indicative Benchmark: MSCI Europe Index Net

Data as of  30-Apr-2020

Performance figures calculated in EUR

  1 YR 3 YR
5 YR
10 YR
Fund % -8.17% -0.68% -1.25% 6.72%
Indicative Benchmark % -13.53% -3.17% -1.73% 4.63%
Excess Return % 5.36% 2.49% 0.48% 2.09%

Inception Date 26-Feb-2007

Indicative Benchmark: MSCI Europe Index Net

Data as of  31-Mar-2020

Performance figures calculated in EUR

Recent Performance

  Month to DateData as of 03-Jun-2020 Quarter to DateData as of 03-Jun-2020 Year to DateData as of 03-Jun-2020 1 MonthData as of 30-Apr-2020 3 MonthsData as of 30-Apr-2020
Fund % 3.43% 16.01% -7.07% 8.11% -13.10%
Indicative Benchmark % 5.31% 15.05% -10.94% 6.12% -16.81%
Excess Return % -1.88% 0.96% 3.87% 1.99% 3.71%

Inception Date 26-Feb-2007

Indicative Benchmark: MSCI Europe Index Net

Indicative Benchmark: MSCI Europe Index Net

Performance figures calculated in EUR

Past performance is not a reliable indicator of future performance.  Source for fund performance: T. Rowe Price. Fund performance is calculated using the official NAV with dividends reinvested, if any. The value of an investment and any income from it can go down as well as up. Investors may get back less than the amount invested. It will be affected by changes in the exchange rate between the base currency of the fund and the subscription currency, if different. Sales charges (up to a maximum of 5% for the A Class), taxes and other locally applied costs have not been deducted and if applicable, they will reduce the performance figures. 

Where the base currency of the fund differs from the share class currency, exchange rate movements may affect returns.

Index returns shown with reinvestment of dividends after the deduction of withholding taxes. 

Effective 1 July 2018, the "net" version of the indicative benchmark replaced the "gross" version of the indicative benchmark. The "net" version of the indicative benchmark assumes the reinvestment of dividends after the deduction of withholding taxes applicable to the country where the dividend is paid; as such, the returns of the new benchmark are more representative of the returns experienced by investors in foreign issuers. Historical benchmark performance has been restated accordingly. 

30-Apr-2020 - Dean Tenerelli, Portfolio Manager,
The MSCI Europe Index surged in April, rebounding from deep losses, on signs of easing lockdown restrictions in some major economies, aggressive stimulus measures, and hopes of a coronavirus treatment. However, gains were curbed by the European Central Bank’s (ECB) decision to maintain its current policy stance rather than expand quantitative easing to make up for the lack of fiscal measures to bolster economies. The portfolio beat the benchmark thanks to strong stock picking. The top-contributing sectors for the portfolio were financials, communication services and consumer discretionary. Health care and real estate performed worst owing to our choice of securities. Financials rose in the market rally leading up to the ECB’s policy-setting meeting at the end of the month. Bawag, the fourth-largest bank in Austria, was the main contributor to relative performance after posting first-quarter results that were seen as solid overall by investors even though the coronavirus dented profits. On the negative side, Getinge, a Swedish medical technology company that is a leading provider of surgical products and operating room supplies, curbed returns in health care. Investors took profits after strong performance this year underpinned by expectations for continued increased demand for ventilators and life support equipment for coronavirus patients.


Largest Holding Nestle 5.12% Was (31-Dec-2019) 3.92%
Other View Full Holdings Quarterly data as of 31-Mar-2020
Top 10 Holdings 29.45% View Top 10 Holdings Monthly data as of 30-Apr-2020

Largest Top Contributor^

Roche Holding
By 1.27%
% of fund 4.04%

Largest Top Detractor^

By -0.20%
% of fund 2.26%


Quarterly Data as of 31-Mar-2020

Top Purchase

Smith & Nephew (N)
Was (31-Dec-2019) 0.00%

Top Sale

Zurich Insurance Group
Was (31-Dec-2019) 3.40%

Quarterly Data as of 31-Mar-2020

31-Dec-2018 - Dean Tenerelli, Portfolio Manager,

Attractively Valued Stocks Emerged as Market Retrenched

Attractive opportunities have emerged in the equity market retrenchment at the end of 2018. These conditions suit our investment approach as they allow us to buy strong high-quality businesses and to diversify the portfolio. We increased our positions most in defensive sectors, such as utilities and real estate, and reduced them in the more cyclical sectors. However, the decline in cyclicals did not deter us from assessing high-quality opportunities with durable earnings that emerged there. On balance, we are tending to find more attractive opportunities in companies that have a more defensive profile or where we believe the market misunderstands the fundamental outlook and unfairly penalizes the company. At the same time, we continue to seek a relatively balanced portfolio in terms of exposures to possible economic scenarios, so that our relative performance is not dependent on a particular "macro" environment.

We altered our positioning by:

  • Raising our exposure to utilities, now our largest overweight, initiating in Iberdrola
  • Moving to an overweight in real estate, adding Great Portland Estates
  • Reducing our underweight in materials, investing in Koningklijke DSM
  • Slimming our overweight in industrials and business services

Raised Exposure to Utilities, Now Biggest Overweight

We increased our exposure to utilities, which is now our biggest overweight. We are overweight in the gas and multi-utilities industries, where we hold Italian names Italgas, a natural gas distribution company, and Hera, a public utility company. We also hold Red Electrica, a partly state-owned and public limited Spanish corporation that operates Spain's national electricity grid.

  • We initiated an investment in Iberdrola, a Spain-based integrated utility company, taking advantage of weakness in the share price, which is driven by regulatory uncertainty. The company is attractively valued, provides a steady income stream, and should benefit over the longer term from its position in the decarbonized renewables and electricity transmission markets. It also has a potential pipeline of new assets extending beyond 2025.

Moved to Overweight in Real Estate

As we seek to maintain a balanced portfolio to counter the impact of market volatility, we raised our exposure to the real estate sector by adding UK office developer Great Portland Estates (GPOR). Our other investment is in Aedas Homes, a Spanish house builder with a large land bank.

  • We believe GPOR, which operates in central London, is undervalued by the market. The management team has an excellent track record, the balance sheet is strong, and the values of its office assets are being underestimated. We believe there is a high probability that GPOR will return capital to shareholders after a successful disposals program.

Reduced Underweight in Materials

We increased our allocation to materials, a sector that we have not favored largely because we did not like the business models of many companies within it. However, when opportunities to own high-quality companies arise, such as in the current market retrenchment, we are happy to invest in them. To this end, we opened a position in Koningklijke DSM, a leading vitamin maker and performance materials business.

We currently own France-based Air Liquide, a large international industrial gas company; Corbion, a Dutch biobased ingredients company operating in the food and biochemical sectors; and Johnson Matthey, a specialty chemicals company that is also the world's biggest auto catalyst maker.

  • We took advantage of share price weakness to invest in DSM. We believe the business is becoming more stable and focused on growth, thanks to the acquisition-driven transformation program. In our view, improving organic growth, an effective cost and capital efficiency program, and the end of the headwind of falling vitamin E prices should drive a share price recovery and outperformance.

Reduced Overweight in Industrials and Business Services

We reduced our overweight industrials and business services amid signs that the European economy is losing momentum, a less favorable environment for this cyclical sector.

We continued to adjust the composition of our holdings, taking advantage of the market decline to sell companies that have underperformed and invest in high-quality businesses with strong industry positions and durable earnings that are now more realistically valued.

We sold out of CNH Industrial, one of the world's largest capital good companies; Trelleborg, a Sweden-based engineering company that develops polymer sealing solutions and wheel systems; and Wolters Kluwer, a Dutch print and digital publisher, after a strong run.

In terms of industry, our largest weight is still professional services companies. We own Bureau Veritas, a France-based international certification agency, and Experian, the leading global provider of credit information with operations in 17 countries, and we swapped Wolters Kluwer for RELX, the world's leading publisher of science journals and a provider of risk assessments on transactions with retail customers. Electrical equipment and aerospace and defense are also overweights. In the former, our biggest position is Schneider Electric, a global specialist in energy management and automation. In the latter, we also hold Dassault Aviation, another French company.

  • We started investing in RELX because we believe the market underestimates the quality and sustainability of growth at the risk business, which provides one of the leading online identity verification tools. It should benefit from the recent acquisition of the ThreatMetrix, one of the leading electronic devices databases. We also believe the risks around the science publishing business are overdone.
  • We sold our position in CNH Industrial because slowing economic momentum and increasing uncertainty in the agricultural sector about the possible impact of tariffs and trade disruptions could further curb sales growth in the main divisions. We exited Trelleborg as signs of weakening demand and emerging risks in the automotive agricultural and industrials segments could, in our view, weigh further on the share price after a period of underperformance.

Maintained Health Care Overweight; Exited Fresenius

We have retained our overweight allocation to the health care sector amid the market uncertainty, which favors defensive sectors. We sold Fresenius, a provider of health care-related products and services, and sister company Fresenius Medical Care after both companies issued a second surprise profit warning in the space of two months. Neither company now expects net income growth in 2019.

We hold sizable positions in pharmaceuticals, with overweights in two Swiss companies, Roche Holding and Novartis, a manufacturer of health care and nutritional products. We also hold Getinge, an off-benchmark Swedish medical technology company with product areas such as surgery, intensive care, infection control, and patient handling.


Largest Sector Industrials & Business Services 20.50% Was (31-Mar-2020) 17.29%
Other View complete Sector Diversification

Monthly Data as of 30-Apr-2020

Indicative Benchmark: MSCI Europe Index

Top Contributor^

Health Care
Net Contribution 1.19%
Selection 0.83%

Top Detractor^

Information Technology
Net Contribution -0.47%


Quarterly Data as of 31-Mar-2020

Largest Overweight

Industrials & Business Services
Fund 20.50%
Indicative Benchmark 12.88%

Largest Underweight

Consumer Staples
Fund 6.11%
Indicative Benchmark 15.58%

Monthly Data as of 30-Apr-2020

30-Apr-2020 - Dean Tenerelli, Portfolio Manager,
We continued to take advantage of market conditions to upgrade the portfolio in a measured way, seeking out high-quality, well-managed companies whose valuations do not reflect their intrinsic worth. We added another four companies in industrial and business services and real estate. We also reduced our exposure to some defensive sectors, due to lower risk/reward after outperformance, such as utilities and health care, and to financials, which face a challenging environment. Our most overweight sectors in relative terms are industrials and business services, real estate, communication services and materials. Consumer staples and information technology remain our largest underweight allocations.


Largest Country United Kingdom 18.17% Was (31-Mar-2020) 16.40%
Other View complete Country Diversification

Monthly Data as of 30-Apr-2020

Indicative Benchmark: MSCI Europe Index

Top Contributor^

United Kingdom
Net Contribution 1.16%
Selection 0.67%

Top Detractor^

Net Contribution -0.29%


Quarterly Data as of 31-Mar-2020

Largest Overweight

Fund 8.97%
Indicative Benchmark 3.31%

Largest Underweight

United Kingdom
Fund 18.17%
Indicative Benchmark 24.13%

Monthly Data as of 30-Apr-2020

30-Sep-2018 - Dean Tenerelli, Portfolio Manager,
The new position in the aforesaid Belgian bank reduced our underweight allocation to the country. Otherwise, our country weights were little changed. Our country positioning is a function of our bottom-up stock picking.

Team (As of 21-May-2020)

Dean Tenerelli

Dean Tenerelli is portfolio manager in the Equity Division at T. Rowe Price. He manages the Europe Equity Strategy, a position he has held since October 2005, and is chairman of its Investment Advisory Committee. He is a vice president of T. Rowe Price Group, Inc. and T. Rowe Price International Ltd.

Mr. Tenerelli has 28 years of investment experience, 19 of which have been at T. Rowe Price. He joined the firm in 2000 as an equity research analyst and was appointed co-manager of the firm's Global Equity Strategy in 2004. Prior to joining T. Rowe Price, Mr. Tenerelli served as a director for Credit Suisse Asset Management, where he was a senior telecommunications analyst. Prior to Credit Suisse Asset Management, Mr. Tenerelli worked as assistant portfolio manager at Artisan Partners (1995-2000). He began his investment career in 1993 at Banesto Bolsa in Madrid as an equity analyst following Spanish equities. Mr. Tenerelli later became an international equity analyst, focused on Europe, for Waddell and Reed in Kansas City, MO. In 1995, he moved to Artisan Partners as an assistant portfolio manager.

A graduate of Rutgers University with a B.A. in economics, Mr. Tenerelli earned an M.B.A. from Escuela Superior de Administración y Direccion de Empresa and an M.A. in international management from American Graduate School of International Management (Thunderbird).

  • Fund manager
  • Years at
    T. Rowe Price
  • Years investment
Andrew Clifton

Andrew Clifton is a portfolio specialist in the Equity Division at T. Rowe Price. He is a vice president of T. Rowe Price Group, Inc., and T. Rowe Price International Ltd.

Mr. Clifton has over 30 years of investment experience, nine of which have been at T. Rowe Price. Prior to joining the firm in 2010, he was an executive director at UBS Global Asset Management. Prior to that, he was a vice president at Merrill Lynch.

Mr. Clifton earned a B.Sc. in economics from the London School of Economics and an M.Sc. in econometrics from the University of Southampton.

  • Years at
    T. Rowe Price
  • Years investment

Fee Schedule

Share Class Minimum Initial Investment and Holding Amount (EUR) Minimum Subsequent Investment (EUR) Minimum Redemption Amount (EUR) Sales Charge (up to) Investment Management Fee (up to) Ongoing Charges
Class A €1,000 €100 €100 5.00% 150 basis points 1.62%
Class I €2,500,000 €100,000 €0 0.00% 65 basis points 0.75%
Class Q €1,000 €100 €100 0.00% 65 basis points 0.82%

Please note that the Ongoing Charges figure is inclusive of the Investment Management Fee and is charged per annum.

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GIPS® Information

T. Rowe Price ("TRP") claims compliance with the Global Investment Performance Standards (GIPS®). TRP has been independently verified for the twenty one- year period ended June 30, 2017 by KPMG LLP. The verification report is available upon request. Verification assesses whether (1) the firm has complied with all the composite construction requirements of the GIPS standards on a firm-wide basis and (2) the firm's policies and procedures are designed to calculate and present performance in compliance with the GIPS standards. Verification does not ensure the accuracy of any specific composite presentation.

TRP is a U.S. investment management firm with various investment advisers registered with the U.S. Securities and Exchange Commission, the U.K. Financial Conduct Authority, and other regulatory bodies in various countries and holds itself out as such to potential clients for GIPS purposes. TRP further defines itself under GIPS as a discretionary investment manager providing services primarily to institutional clients with regard to various mandates, which include U.S, international, and global strategies but excluding the services of the Private Asset Management group.

A complete list and description of all of the Firm's composites and/or a presentation that adheres to the GIPS® standards are available upon request. Additional information regarding the firm's policies and procedures for calculating and reporting performance results is available upon request

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