Why investors should be wary of Europe's value traps

Low equity prices in Europe are deceptive and could spell problems for unwary investors, according to Gregory Kolb, manager of Janus Capital's Perkins Global Value Fund.

Kolb said the 35% rise in European equities seen over the past 12 months meant investors now appear relatively oblivious to the consequences of the region's ongoing economic crisis. The manager added that worsening fundamentals offset the relative attractions of European equity valuations. "Markets may be rising, but the macroeconomic signals coming from Europe are far from optimistic," he said. "Perhaps most troubling is the fact that there is still little consensus among the 17 eurozone nations about how best to resolve the prolonged crisis." Kolb holds 31% of his portfolio in...