The European Smaller Companies Trust’s (ESCT’s) manager, Ollie Beckett at Janus Hendersons Investors (JHI), remains very positive about the outlook for European small-cap companies, which is reflected in a relatively high level of gearing of c 15%. He considers the last three years, where small-cap stocks have lagged the performance of large-cap equities, an anomaly and a result of macroeconomic events and recession fears, which have led to elevated investor risk aversion. The manager believes that the current valuation of the trust’s benchmark, the MSCI Europe ex UK Small Cap Index, provides a very attractive entry point to the asset class. ESCT’s portfolio of reasonably valued stocks with exposure across the company life cycle has a commendable performance track record, with its NAV total return ranking first out of the four funds in the AIC European Smaller Companies sector over the last one, three, five and 10 years.