Robert Lancastle, Senior Portfolio Manager for J O Hambro Capital Management Group, joined Julie Cooling, Founder and CEO of RIA Channel, to discuss how geopolitical changes are moving Europe toward rebuilding infrastructure and manufacturing capacity.
J O Hambro is a boutique active equity manager that looks to recruit best-of-breed managers. Lancastle is the portfolio manager for an international value equity fund, J O Hambro International Opportunities Fund (JOPSX). As of the end of May 2025, the fund has outperformed its MSCI EAFE benchmark since its September 2016 inception. Lancastle seeks to invest in a concentrated portfolio of 25 to 40 stocks offering durable franchises with value characteristics, searching in just 20% of the market for opportunities. The fund has strong research in industrial, energy, infrastructure, materials, and utility stocks in the European and Japanese markets.
Lascastle sees Europe moving to a domestic focus due to developments such as COVID, the Ukraine war, rising rates and inflation, and protectionist economic policies. Over the last twenty years, Europe has relied on China for manufacturing and Russia for energy. To rebuild that domestic capacity, Europe will substantially increase infrastructure investments. Lancastle believes this trend toward investments in capital-intensive industries will persist for the next five years.
In the wake of the Magnificent Seven performance, many US investors are underweight international equities. A neutral weight to international equities would be 25%, with the economic tailwinds favoring even larger allocations.
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