- Out of 123 European equity funds analysed, only 26 achieved top 4- or 5-star ratings across the 6-month, 1-year, 3-year, and 5-year periods.
- 63.4% of European equity funds have a history of underperformance, with 38 receiving a low 1-star rating and 40 rated just 2 stars.
- The Artemis SmartGARP European Equity fund has consistently been one of the top performers within the IA Europe Ex UK sector across the periods analysed.
- The WS Ardtur Continental European fund has achieved the highest return of 143.66% over the past five years in its sector.
European equity funds continue to be a popular choice for UK investors looking to diversify. These funds invest in companies across continental Europe and currently hold around £48 billion within the IA Europe ex UK sector.
After several years of being overlooked in favour of US markets, European funds are attracting fresh attention in 2025. Falling inflation, stronger economic data, and more stable market conditions have helped improve investor confidence. In May, UK investors placed £369 million into European equity funds - the highest monthly inflow in nearly a year. Globally, demand for European equities has also risen, as investors shift money away from the US due to concerns about tariffs and interest rates.
But while conditions have improved, challenges remain. Currency swings, political risk, and ongoing trade issues have made fund performance more uneven. The gap between the best and worst performers has grown wider.
To help investors make sense of the market, we analysed 123 European equity funds and rated their performance over the past 6 months, 1 year, 3 years, and 5 years. Only 26 of these funds delivered top performance consistently across all timeframes. In contrast, 78 funds underperformed and received a low 1 or 2-star rating.
In this article, we highlight the 10 best-performing European equity funds based on their past results. These are not personal recommendations, but a factual look at the funds that have stood out.
European Equity Funds Performance Summary
We analysed 123 European equity funds, reviewing their returns and sector rankings over the past 6 months, 1 year, 3 years, and 5 years. Each fund was given a performance rating based on how it compared to others in the IA Europe ex UK sector.
Only 26 funds achieved a 4 or 5-star rating, showing a consistent ability to outperform their peers across all timeframes. In contrast, 78 funds - more than 60% of those analysed - received a low 1 or 2 star rating due to persistently below-average returns.
These results highlight the wide gap in quality and underline the importance of careful fund selection when investing in this sector.
This underscores the wide variation in quality across the sector and reinforces the need for careful fund selection when investing in European equities.
10 Top Performing European Equity Funds
The following 10 funds have consistently ranked among the strongest performers in the IA Europe ex UK sector. Each has delivered competitive returns across the past 6-month, 1-year, 3-year, and 5-year periods.
Most of these funds achieved a 4 or 5-star performance rating, highlighting their ability to outperform peers over multiple timeframes and across varying market conditions.
Each of these funds has consistently ranked among the top performers within the IA Europe ex UK sector over the periods analysed.
The above table details the annual performance for each of the 10 funds.
1. WS Ardtur Continental European Fund
The WS Ardtur Continental European fund is an actively managed strategy that seeks long-term capital growth by investing in listed companies across continental Europe. It primarily focuses on equities but retains the flexibility to hold government bonds, fixed-interest securities, and preference shares when appropriate.
With around £311 million under management, this fund has delivered consistently strong results over all measured periods. Over the past six months, it returned 19.84%, placing it 10th out of 124 funds in its sector - well above the average return of 12.13%. Its one-year return of 12.67% ranked 15th of 123 funds, compared with a sector average of 6.6%. Over three years, it produced a cumulative return of 50.73% (8th of 121), and over five years, it topped the sector with a gain of 143.66%, ranking 1st out of 114 funds.
The fund’s performance has been driven by a value-oriented approach focused on European companies with stable earnings and attractive valuations. Sector exposure has leaned towards areas that have supported Europe’s recent economic rebound, including financials, energy, and industrials. Key holdings such as Shell, Orange, Ericsson, Commerzbank, and Deutsche Bank have been among the notable contributors.
A consistent investment approach and timely sector positioning have helped the fund navigate changing market conditions and deliver top-quartile results over multiple timeframes.
2. Artemis SmartGARP European Equity Fund
The Artemis SmartGARP European Equity fund aims to achieve long-term capital growth by investing in undervalued European companies outside the UK. It applies a quantitative approach, using an in-house screening tool to identify companies with improving fundamentals - such as rising earnings and analyst upgrades - while maintaining attractive valuations. This systematic process is designed to support consistent investment decisions through different market conditions.
The strategy has delivered strong results across all measured periods. Over the past six months, the fund returned 31.16%, ranking 1st out of 124 funds in the IA Europe ex UK sector. Its one-year return of 26.27% placed it 2nd out of 123. Over three years, it achieved a cumulative return of 76.95%, the highest in its sector, while its five-year return of 142.64% ranked 2nd out of 114 funds - well ahead of the 90.42% sector average.
The fund maintains broad geographic exposure and has benefited from allocations to European financials and cyclical sectors, which have responded positively to economic recovery and rising interest rates.
Its consistent performance across varying conditions places it among the strongest-performing funds in the European equity sector.
3. Quilter Investors Europe (ex UK) Equity Income Fund
This fund takes an income-focused approach by investing in European companies that offer reliable dividend streams, while also aiming for long-term capital growth. At least 80% of the portfolio is invested in firms based in continental Europe, excluding the UK.
It has delivered consistently competitive returns across all measured periods. Over the past six months, the fund returned 15.86%, ahead of the sector average of 12.13%. Its one-year return of 9.66% placed it 35th out of 123 funds. Over three years, it achieved a cumulative return of 35.90%, while its five-year return of 97.19% ranked 5th out of 114 funds - well above the 63.58% sector average.
Performance has been supported by targeted exposure to financials, industrials, and healthcare - areas that have contributed to Europe's economic rebound and offered resilience through shifting market cycles.
Its blend of dividend strength and capital growth has helped position it among the top-performing funds in its sector over the longer term.
4. HSBC Euro Stoxx 50 Fund
This fund offers low-cost exposure to eurozone equities by tracking the Euro Stoxx 50 Index, which includes the 50 largest listed companies across the European Monetary Union. It uses full physical replication, directly investing in each constituent based on its market weight. The fund manages around €1.4 billion in assets.
Over the past six months, it returned 15.71%, outperforming the sector average of 12.13%. Its one-year return of 10.15% also exceeded the average of 6.6%. Over three years, the fund delivered 52.67%, ranking 6th out of 121, while its five-year return of 90.92% placed it 9th out of 114 funds - well ahead of the 63.58% sector average.
The fund’s performance has been supported by broad exposure to eurozone markets, with holdings across Germany, France, the Netherlands, Spain, and Italy. Key constituents such as SAP, ASML, and Siemens have contributed through stable earnings and sector leadership.
Improved eurozone conditions since 2022 - such as falling inflation, fiscal support, and stronger corporate earnings - have also played a role. With an ongoing charge of just 0.05%, the fund provides a cost-effective route to accessing large-cap eurozone equities.
5. EdenTree European Equity B
The EdenTree European Equity B fund aims to deliver both capital growth and income by investing in a diversified range of companies across continental Europe. At least 80% of its holdings are in firms that demonstrate positive environmental and social practices, reflecting a sustainability-focused investment approach.
The fund has delivered strong returns across multiple timeframes. Over the past six months, it returned 16.09%, outperforming the sector average of 12.13%. Its one-year return of 9.13% placed it in the upper half of its peer group. Over three years, it achieved a cumulative return of 39.89%, ahead of the 32.27% sector average. Its five-year return of 90.86% ranked 10th out of 114 funds, well above the sector’s 63.58% average.
Performance has been supported by exposure to large European companies with strong sustainability profiles. Holdings such as Enel, Orange, Covivio, Banco Santander, and Allianz have contributed to the fund’s long-term results.
By combining financial analysis with environmental, social, and governance (ESG) considerations, the fund has consistently ranked among the top performers in the IA Europe ex UK sector while maintaining a clear sustainability framework.
6. JPM Europe Dynamic Ex UK C Acc
The JPM Europe Dynamic Ex UK C Acc fund aims to deliver capital growth by investing primarily in European equities outside the UK, with a flexible, style-neutral approach. It combines bottom-up stock selection with quantitative analysis to identify high-conviction opportunities across the European equity market, with limited constraints on sector or market cap.
The fund has delivered competitive returns across all measured periods. Over the past six months, it returned 17.97%, ranking 15th out of 124 funds. Its one-year return of 10.63% comfortably exceeded the sector average of 6.6%. Over three years, it gained 44.36%, placing 18th out of 121 funds. Its five-year return of 90.35% ranked 12th out of 114, significantly ahead of the 63.58% sector average.
Recent performance has been supported by meaningful exposure to sectors such as banking, pharmaceuticals, biotech, and technology services - all of which performed strongly amid improving eurozone conditions and easing inflation. Core holdings including SAP, Allianz, Novartis, and Roche have provided consistent returns and contributed to the fund’s resilience.
Its flexible investment process and diversified positioning have helped the fund maintain top-quartile rankings across multiple timeframes within the IA Europe ex UK sector.
7. Waverton European Capital Growth Fund
The Waverton European Capital Growth fund aims to deliver long-term growth by investing in a diversified mix of European equities. It focuses primarily on large and mid-sized companies and uses a bottom-up stock selection process to identify undervalued businesses with strong long-term potential.
The fund has no set constraints on sector or size, allowing broad flexibility in portfolio construction. Over the past six months, it returned 13.77%, ahead of the sector average of 12.13%. Its one-year return of 12.14% ranked 16th out of 123 funds. Over three years, the fund delivered a return of 49.43%, placing 9th out of 121, while its five-year return of 90.14% ranked 14th out of 114 - significantly ahead of the 63.58% sector average.
The portfolio has maintained a bias towards European industrial and financial stocks - areas that have benefited from increased defence spending and a broader rotation into value. These themes have supported consistent earnings growth and contributed to the fund’s strong performance relative to its peers.
8. Janus Henderson European Focus Fund
The Janus Henderson European Focus I Acc fund aims to deliver long-term growth and income by investing in a concentrated portfolio of European companies, excluding the UK. At least 80% of the portfolio is allocated to equities, with no fixed constraints on sector, size, or investment style.
The fund follows a bottom-up approach, selecting a limited number of companies based on detailed analysis of their financial strength and growth potential. By focusing on a smaller number of high-conviction holdings, it seeks to identify overlooked or undervalued opportunities across the European market.
This strategy has produced competitive results across multiple timeframes. Over the past six months, the fund returned 17.01%, ranking 20th out of 124. Its one-year return of 9.03% exceeded the sector average of 6.6%. Over three years, it delivered 46.51%, placing 13th out of 121, while its five-year return of 85.91% ranked well above the sector average of 63.58%.
Recent performance has been supported by key holdings in financials, healthcare, and industrials, including UniCredit, RELX, SAP, and Rheinmetall. The fund’s concentrated structure and flexible approach have contributed to its strong position within the IA Europe ex UK sector.
9. M&G European Sustain Paris Aligned Fund
This fund aims to outperform the MSCI Europe ex UK Index over five years by investing in a concentrated portfolio of European companies, typically holding fewer than 35 stocks. It combines financial objectives with a sustainability goal, targeting firms that are actively working to reduce their carbon emissions in line with the Paris Agreement.
At least 70% of the portfolio is allocated to companies expected to contribute to climate change mitigation by moving towards net-zero emissions. Rather than focusing solely on companies with already strong ESG credentials, the fund seeks out “sustainability improvers” - businesses taking measurable steps to lower their environmental impact.
Over the past six months, the fund returned 12.70%, slightly ahead of the 12.13% sector average. Its one-year return of 10.48% outperformed the 6.6% peer average. Over three years, it delivered 49.04%, ranking 10th out of 121 funds. Its five-year return of 85.76% placed it 20th out of 114 funds - well above the sector’s 63.58% average.
The fund’s performance has been supported by exposure to leading European businesses across a range of sectors and countries. With an ongoing charge of 0.55%, it combines a focused sustainability mandate with strong long-term performance within the IA Europe ex UK sector.
10. Vanguard Eurozone Stock Index Fund
The Vanguard Eurozone Stock Index Fund is a passive strategy that aims to track the performance of the MSCI EMU Index, which includes large and mid-cap companies from countries within the eurozone. The fund uses full replication or sampling methods, depending on market conditions, to mirror the index’s composition. It currently manages around €1.61 billion in assets.
The fund has delivered consistently strong performance across multiple timeframes. Over the past six months, it returned 17.20%, ranking 18th out of 124 funds. Its one-year return of 11.87% was nearly double the sector average of 6.6%. Over three years, it returned 44.73%, ranking 14th out of 121, while its five-year return of 79.42% placed it 25th out of 114 funds, well above the sector average of 63.58%.
The portfolio maintains broad exposure across eurozone economies, with sector allocations tilted towards financials, industrials, and technology - areas that have supported recent growth and reflect the structure of the underlying index.
With an ongoing charge of 0.12%, the fund offers one of the most cost-efficient ways to access eurozone equity markets while maintaining strong relative performance within its sector.
Conclusion
The European equity market continues to offer opportunities for growth and diversification, particularly as confidence returns to the region in 2025. However, as this analysis has shown, the performance gap between funds in the IA Europe ex UK sector remains wide. While a small group of funds have delivered consistently strong returns, a majority have struggled to keep pace with their peers.
With more than 60% of funds underperforming over multiple timeframes, identifying the right options requires more than simply choosing well-known names or recent winners. It demands a deeper understanding of fund composition, strategy, and consistency—factors that are not always visible from headline performance alone.
If you're unsure how your existing European equity exposure compares, or whether your portfolio could benefit from a more refined selection process, it may be worth seeking a professional review. Understanding whether your holdings are aligned with your long-term goals and properly diversified is a key part of managing investment risk.
Professional reviews can provide valuable clarity. Our partnership with MKC Wealth gives access to a team of experienced financial planners who can provide a personalised review of your investments. These reviews identify areas of strength, flag potential weaknesses and highlight how they fit within your overall financial planning goals.
