Foto cedida. UBS WM nombra a Anja Heuby-Egli responsable del área de soluciones de inversión sostenible
UBS Wealth Management has appointed Anja Heuby-Egli to lead a newly-created sustainable investment solutions function, reported Citywire Selector. She will be responsible for sustainable investing solutions at global wealth management, including general advisory, discretionary and advisory mandates, funds and alternatives.
According to an internal memo referred to by the publication, Heuby-Egli will join UBS chief investment office’s global mandates and investment content team (CIO GMIC) and will report directly to its head, Bruno Marxer. She will also become a member of the unit’s management committee.
Within global wealth management, her role only covers the CIO’s global mandates and investment content function. Andrew Lee will remain head of sustainable and impact investing for its other investment functions, which are known internally as the CIO investment office (IO), informed Citywire Selector. That unit is responsible for investment frameworks, for example asset allocation, methodologies and associated research and thought leadership.
Meanwhile, global mandates and investment content team is in charge of investment products, including those implementing investment views of the IO. When it comes to the 100% sustainable portfolios, Lee will continue to oversee the portfolio framework and methodology and any thought leadership associated with that.
Heuby-Egli’s team will work on the implementation of that framework in products, in collaboration with other content teams. Her primary focus will be EMEA, APAC, and Switzerland, and she will also collaborate with the Americas sustainable investing solutions team.
Experience in sustainable investment
Heuby-Egli started at UBS in 2005 and has worked in the investment bank, group functions, and global wealth management, primarily in the area of risk and investment process methodology. She was in charge of CIO’s data innovation and also worked with the CIO sustainable investment team, where she and her team developed the proprietary ESG scoring platform at the core of the firm’s personalised sustainable investment advice offering. Her new role will be covering wealth management activities, opposite to those of the whole UBS group.
An economic recovery appears to be gathering pace. That means emerging market stocks, and some cyclical sectors, are looking more attractive.
It’s looking increasingly like a V-shaped economic recovery. True, in some regions the bounce back has been a little less robust. But in others, notably China, economic conditions are largely back to where they were pre-Covid – in July, industrial profits were up 20 per cent year on year. Meanwhile, after reviewing its approach to monetary policy, the US Federal Reserve has formally become a much more dovish institution at the margin, though it stopped short of a radical overhaul anticipated by some in the market.
Markets have noticed. Yet after a powerful rally across all assets during the past few months – sending leading US stock market indices to record highs – we feel that prospects for further broad-based gains are limited, with greater divergence among regional markets.
So while governments may yet offer more fiscal stimulus, not least in the US, liquidity provision is slowing worldwide. There are also political risks associated with US elections in November. And all the while there’s Covid-19. Not only is there the possibility of a significant second wave of the virus, but there is also little clarity on how soon a vaccine might be developed. At the same time, Shinzo Abe’s decision to step down after being Japan’s longest-serving prime minister introduces some uncertainty around geopolitics and the possibility that the world’s third largest economy will change its policy approach.
As a result, we remain neutral on all the major asset classes, though within equities we favour more cyclical sectors.
Our business cycle indicators show that the economic recovery is proving to be strong enough to warrant an upgrade to our 2020 economic forecasts. Our economists now expect full year global GDP to come in at -4 per cent from -4.2 per cent previously, but next year’s forecast has been cut to 6.1 per cent from 6.4 per cent.
In the US, retail sales have registered the strongest and fastest ever rebound after the deepest and quickest downturn in history to where they’re now – running at above pre-recession peak. Most past cycles have taken at least three years to play themselves out. This time, it’s been only a little more than three months. Retail sales are also back to trend in the euro zone.
However, it’s notable that only China’s real-time indicators are back to pre-Covid levels. Elsewhere, they’ve flattened out at between 10 per cent and 20 per cent below.
And while inflation could yet prove to be a risk if demand remains firm and supply fails to catch up, that’s not likely to be an issue until the back half of 2021.
Global liquidity conditions remain very supportive, with new liquidity creation running at 25 per cent of GDP, but there is clear evidence that monetary stimulus growth has peaked [see Fig. 2]. At the same time, banks are tightening credit standards. And the Chinese central bank is now at neutral, while the country’s credit surge has tapered back down.
One upside liquidity risk, though, is that US Treasury cash balances held by the central bank could be drawn down.
Our sentiment indicators paint a mixed picture. The balance of equity calls to puts suggests a degree of market complacency, and our indicators show hedge funds have crowded into a handful of concentrated positions, particularly in the largest of the large cap stocks. On the other hand, retail investors seem cautious about shares and sentiment surveys remain depressed, while fund manager positioning in the asset class is below historic trend. A “wall of cash” remains, with some recently flowing into bonds and credit – both appear overbought.
Finally, our valuation indicators suggest equity prices look stretched after a 50 per cent rally in the S&P 500 – on our models, they are at their most expensive in 12 years, trading two standard deviations above their 6-month moving average. Even relative to bonds, equity valuations no longer look particularly cheap. The gap between the global earnings yield and global bond yield is at its lowest in a decade at 4.5 percentage points. But we’re not yet into bubble territory. If current low bond yields, which have fallen 100 basis points this year, are sustained, this valuation impact on US equities exactly offsets the 20 per cent decline in earnings. Our valuation score on equities has moved from negative in January, to strongly positive in March and is back down to negative now.
Information, opinions and estimates contained in this document reflect a judgment at the original date of publication and are subject to risks and uncertainties that could cause actual results to differ materially from those presented herein.
Important notes
This material is for distribution to professional investors only. However it is not intended for distribution to any person or entity who is a citizen or resident of any locality, state, country or other jurisdiction where such distribution, publication, or use would be contrary to law or regulation. Information used in the preparation of this document is based upon sources believed to be reliable, but no representation or warranty is given as to the accuracy or completeness of those sources. Any opinion, estimate or forecast may be changed at any time without prior warning. Investors should read the prospectus or offering memorandum before investing in any Pictet managed funds. Tax treatment depends on the individual circumstances of each investor and may be subject to change in the future. Past performance is not a guide to future performance. The value of investments and the income from them can fall as well as rise and is not guaranteed. You may not get back the amount originally invested.
This document has been issued in Switzerland by Pictet Asset Management SA and in the rest of the world by Pictet Asset Management Limited, which is authorised and regulated by the Financial Conduct Authority, and may not be reproduced or distributed, either in part or in full, without their prior authorisation.
For US investors, Shares sold in the United States or to US Persons will only be sold in private placements to accredited investors pursuant to exemptions from SEC registration under the Section 4(2) and Regulation D private placement exemptions under the 1933 Act and qualified clients as defined under the 1940 Act. The Shares of the Pictet funds have not been registered under the 1933 Act and may not, except in transactions which do not violate United States securities laws, be directly or indirectly offered or sold in the United States or to any US Person. The Management Fund Companies of the Pictet Group will not be registered under the 1940 Act.
Pictet Asset Management Inc. (Pictet AM Inc) is responsible for effecting solicitation in North America to promote the portfolio management services of Pictet Asset Management Limited (Pictet AM Ltd) and Pictet Asset Management SA (Pictet AM SA).
In Canada Pictet AM Inc is registered as Portfolio Managerr authorized to conduct marketing activities on behalf of Pictet AM Ltd and Pictet AM SA. In the USA, Pictet AM Inc. is registered as an SEC Investment Adviser and its activities are conducted in full compliance with the SEC rules applicable to the marketing of affiliate entities as prescribed in the Adviser Act of 1940 ref. 17CFR275.206(4)-3.
Banorte-Ixe Securities International, member FINRA and SIPC, an investment management and brokerage service company, has relocated its U.S. headquarters to Houston. Led by a new and experienced management team, the relocation of the headquarters closer to the company’s client base and the expansion of technology-infused product offerings marks a pivotal shift in the company’s operating strategy.
A subsidiary of Grupo Financiero Banorte, the second-largest financial institution in Mexico, BSI applies the same time-tested, relationship-driven approach to providing investment solutions to a growing base of Mexican and domestic clients.
“Our relocation of the U.S. headquarters to Houston is the start of a new chapter for Banorte Securities,” said Grupo Financiero Banorte’s Private Banking Managing Director, Luis Pietrini. “With a new seasoned management team at the helm and an expanded array of technology-driven products to appeal to our sophisticated clientele, we are committed to extending the same trusted expertise fueling Banorte in Mexico for the past 100 years to clients across North America.”
BSI’s brokerage services offer numerous investing options including mutual funds, equities and fixed income products, while the company’s advisory services deliver a globally diversified investment strategy tailored to meet client’s specific short and long-term financial objectives.
BSI’s newly instated management team is led by Houston-based CEO Xavier Ibarrola. Ibarrola came to the company from the BBVA Group where he spent more than 20 years in investments and financial management positions.
In addition to unveiling the company’s new headquarters and announcing its leadership team, BSI is expanding its product offerings to existing, Mexican-based clients with the launch of BAM Digital. Created in partnership with BlackRock, BAM – Banorte Asset Management – Digital is BSI’s first-ever fully digital investment alternative. Easy to access via the website or through an app, BAM Digital features globally diversified portfolio options designed by BlackRock and backed by a team of seasoned advisors.
“Everything we do at Banorte Securities is designed specifically with our client’s needs in mind,” said Banorte Securities CEO Xavier Ibarrola. “As our clients become increasingly tech-savvy and ‘hands on’ in their personal financial journey, developing an easy to use, fully digital investment platform was the logical next step in growing our market segments and building stronger, long-term relationships with our clients.”
Ibarrola continued, “We are eager to unveil BAM Digital to our existing clients in Mexico and look forward to introducing this fully-digital platform to our domestic clientele in the near future.”
While BSI’s headquarters is located in the Galleria area, the company maintains a branch in The Woodlands, a suburb north of Houston, and plans to expand across Texas, as well as Miami and San Diego in the coming years. In addition to providing brokerage and advisory services, Banorte Securities will host a variety of programs aimed at empowering customers on their personal financial journeys.
“Houston’s proximity to a large portion of our client base, growing economy and connection to Banorte’s Mexican culture makes it the perfect home for Banorte Securities’ U.S. headquarters,” continued Ibarrola. “We are excited to deepen our roots in Houston and look forward to helping this amazing community – clients and nonclients alike – achieve their financial goals.”
Located at 5075 Westheimer Road, the company’s new 10,000-square-foot headquarters currently houses 24 full-time employees with space to accommodate 42 total employees in the years to come. Designed by AMB Architects, the open concept office infuses flares of Mexican/Houston culture through brightly colored pops of graffiti art décor including two 6 by 8–foot custom murals.
The longest economic expansion and market upward cycle in history came to an end with the outbreak of the pandemic. A major part of this long extension of the cycle is explained by the superior performance of U.S. and technology sector equities, which have performed close to 10.8% over the past five years. In fixed income, investment grade corporate bonds and U.S. Treasury bonds provided the highest yields. At 5.7% and 5.6% per year respectively, they far outperformed European debt yields.
In looking ahead to the next five years, Pictet Asset Management believes it is inevitable to consider the long-term implications that the pandemic will have on the economy and the markets. Although it is still early to draw conclusions, Luca Paolini, the management company’s Chief Strategist, says that the pandemic has been more a factor in accelerating existing trends rather than a catalyst for new ones.
As the economy recovers from the impact of the Coronavirus, it appears that the underlying growth trends in the global economy have remained intact. However, Paolini highlights three aspects that, in his opinion, represent a change in this new phase of recession: more debt, more government interference, and more Asian leadership.
The significant increase in debt
Both the level of government deficits and the level of corporate leverage are at record highs. Currently, the level of public debt as a percentage of GDP in developed economies is close to 120%. This is close to the level experienced in the 1940s, but there is a difference. At that time, demographics were much more favorable and potential growth was stronger, making it easier to free oneself from the burden of debt.
The problem facing the global economy now is how to move forward with such a high level of debt in an environment where political austerity is no longer considered an option. At this point, it is necessary to keep in mind that when you start a cycle with a high level of debt it is very difficult to create growth. As Paolini explains, the most obvious solution is an accommodating monetary response to support government spending. After a crisis of great dimensions, the population is going to require greater social aid from the governments and this can be financed at a lower cost if the central banks maintain their accommodating policies.
Greater government involvement in the global economy
From the pre-COVID position in which governments played a regulatory role and private interests dominated, there is a shift to a new scenario in which the public interest is given priority. As a result, greater government intervention can be expected, both in terms of legislation, such as minimum wage issues, and in industrial policy issues, where sectors considered strategic will receive greater attention, seeking national autonomy and sufficiency.
A greater role for Asia in the global economy
The Asian region has clearly emerged stronger from this crisis. Their economies have a higher manufacturing component and a strong technology sector, something that has clearly played in their favor and made them more resilient. In the debt markets, Chinese sovereign bonds are proving to be a more interesting option than corporate debt in developed markets, as they are currently trading at a record spread against US Treasury bonds. The People’s Bank of China has been less expansionary than other central banks, so it has more room for maneuver and the risk of inflation is lower. Meanwhile, in the Chinese stock market, stocks show cheap valuations and the renminbi is also at favorable levels.
What is the next step for central banks?
Central banks in major economies have fewer and fewer instruments to try to revive the economy. The Federal Reserve, the European Central Bank, the Bank of England, and the Bank of Japan have all implemented quantitative easing programs including government and corporate bond purchases. All have offered subsidized loan programs to their banks and have kept indications on the future direction of their monetary policy (forward guidance). In addition, some central banks, such as the European Central Bank and the Bank of Japan, have experimented with negative interest rates.
Recently, the Fed has revised its inflation target and soon we may see the implementation of formal or informal instruments that exercise control over the yield curve. In Paolini’s opinion, the extreme version of monetary financing implied by modern monetary theory (MMT) is not ruled out for now.
With all this intervention, investors should be concerned about the possible impact that these actions by central banks may have on asset class valuations. The market consensus on this issue seems to be that, as central banks continue to issue money, asset prices can only go up. In Paolini’s opinion, this is a very simplistic version of reality, but he recognizes that the fact that central banks have injected a huge amount of liquidity into the markets is supporting valuations in a way that would have been unthinkable just a few months ago.
Equities remain more attractive than government bonds
A decade of qualitative easing and accommodative monetary policies has made it very difficult to find value in the markets today. For example, the dividend yield on the S&P 500 index is 1.6%, while the yield on US sovereign debt is 0.6%; if you take an average of these yields, the current yield on a balanced portfolio is less than inflation. Currently, most assets are at levels of valuation that would typically be associated with a period of expansion, while the reality is that we are in a period of recession.
Financial repression, understood as a situation in which bond yields are artificially kept below GDP growth, has undergone a significant change from the previous year. If the expectation a year ago was that bond yields would increase – even if not significantly – today interest rates are expected to remain lower for longer, with all the implications this has for financial assets.
Another issue to consider is that, although GDP growth and monetary stimuli are not very different from those seen in the last 10 years, there will be a significant change in regional leadership, especially in the equity market. If the undisputed leader of the last bullish market cycle was the United States, in the bullish cycle that began in March a rotation could be expected. As has been the case for the last 30 years, it is very likely that another market will start to pull the strings, so Paolini comments that it is a good time for the American investor to diversify his portfolios between Europe and emerging markets.
For Pictet AM’s Secular Outlook report, detailing key market trends and investment insights for the next five years, download here
Information, opinions and estimates contained in this document reflect a judgment at the original date of publication and are subject to risks and uncertainties that could cause actual results to differ materially from those presented herein.
Important notes
This material is for distribution to professional investors only. However it is not intended for distribution to any person or entity who is a citizen or resident of any locality, state, country or other jurisdiction where such distribution, publication, or use would be contrary to law or regulation. Information used in the preparation of this document is based upon sources believed to be reliable, but no representation or warranty is given as to the accuracy or completeness of those sources. Any opinion, estimate or forecast may be changed at any time without prior warning. Investors should read the prospectus or offering memorandum before investing in any Pictet managed funds. Tax treatment depends on the individual circumstances of each investor and may be subject to change in the future. Past performance is not a guide to future performance. The value of investments and the income from them can fall as well as rise and is not guaranteed. You may not get back the amount originally invested.
This document has been issued in Switzerland by Pictet Asset Management SA and in the rest of the world by Pictet Asset Management Limited, which is authorised and regulated by the Financial Conduct Authority, and may not be reproduced or distributed, either in part or in full, without their prior authorisation.
For US investors, Shares sold in the United States or to US Persons will only be sold in private placements to accredited investors pursuant to exemptions from SEC registration under the Section 4(2) and Regulation D private placement exemptions under the 1933 Act and qualified clients as defined under the 1940 Act. The Shares of the Pictet funds have not been registered under the 1933 Act and may not, except in transactions which do not violate United States securities laws, be directly or indirectly offered or sold in the United States or to any US Person. The Management Fund Companies of the Pictet Group will not be registered under the 1940 Act.
Pictet Asset Management Inc. (Pictet AM Inc) is responsible for effecting solicitation in North America to promote the portfolio management services of Pictet Asset Management Limited (Pictet AM Ltd) and Pictet Asset Management SA (Pictet AM SA).
In Canada Pictet AM Inc is registered as Portfolio Managerr authorized to conduct marketing activities on behalf of Pictet AM Ltd and Pictet AM SA. In the USA, Pictet AM Inc. is registered as an SEC Investment Adviser and its activities are conducted in full compliance with the SEC rules applicable to the marketing of affiliate entities as prescribed in the Adviser Act of 1940 ref. 17CFR275.206(4)-3.
Longevity is about ‘whole of life’ – not just end of life. People of all ages are likely to use goods and services that come under this umbrella – which includes wellness, health and medical treatments as well as silver spending, senior care and funeral services.
Below, Peter Hughes and Dani Saurymper , Portfolio Managers at AXA IM, highlight how the longevity economy is impacting peoples’ lives worldwide and show how they are benefiting from the innovations and solutions being offered by a wide variety of companies.
1. Your workout
Keeping fit and healthy is important for a longer life. People over 65 are the UK’s most frequent gym goers, with gym usage peaking at age 72, according to a study by Nuffield Health[1]. But many regular gym-goers have had to stay at home during coronavirus lockdowns, and have turned to trying virtual exercise classes at home. Low-cost European gym provider Basic Fit has an app that offers a range of programmes for training at home, including virtual classes and a personalised nutrition plan.
2. Seeing the doctor – virtually
Sometimes it can be difficult to schedule a doctor’s appointment, especially if you need to fit it around work or family responsibilities. And during the coronavirus pandemic, many medical practitioners have preferred to conduct online or video consultations. Global virtual care provider Teladoc Health saw total visits increase 92% to two million in the first quarter of 2020, as the coronavirus pandemic took hold[2]. Its services include being able to a speak to a doctor or mental health specialist over the phone, uploading photos for a dermatologist to review and getting a prescription that can be sent electronically to the pharmacy for you to collect.
3. Home treatment
If you are unwell or have had an operation, studies have suggested that recovery at home leads to shorter hospital stays, reducing the burden on hospital beds without a negative impact on patient outcomes[3]. But sometimes professional help is needed, for instance physical therapy or wound care. Amedisys is an example of one of the companies offering home health visits across the US, aiming to help their patients keep their independence and quality of life.
4. Managing an ongoing condition
Six in 10 US adults have a chronic disease[4] and the need to manage an ongoing condition is a global theme. Medical innovations and the use of digital technology have made managing chronic diseases such as Type 2 diabetes much simpler. For instance, Dexcom offers a glucose monitoring system which can send an alert to your smartphone if your blood sugar levels become too low. In addition, medical technology company Masimo has a product for use at home that can measure oxygen levels, pulse rate and more.
5. Optimising your health
Vitamins and supplements are also a big market, with key players including Reckitt Benckiser – who says its Digestive Advantage is the number one probiotic gummy brand[5]. A National Health and Nutrition Examination Survey found that around one in two US adults supplement their diet with vitamins[6]. Meanwhile the European dietary supplements market was worth $14.3bn in 2018 and is expected to reach $20.9bn by 2026[7].
6. And not forgetting your pet
Almost 50% of US households own a pet according to the latest US census data[8] with owners spending $528 per year on average[9]. Meanwhile the Asia Pacific region is seeing the highest growth globally in sales of cat and dog food, as pet ownership there increases[10]. Many people own pets for companionship or to encourage them to take exercise, such as walking a dog.
But having a pet means caring for them when they are sick and keeping up with regular treatments as well as their changing needs as they age. Petcare firm Zoetis is an example of one of the companies in this space that is innovating to develop new products and solutions for animal health.
7. Improving your career prospects
As we are living longer and the world changes more quickly – for example via digitalisation – we cannot expect everything we learned at school or university, or even in our early 20s, to still be enough – or relevant – throughout our working lives. You might choose to study to improve your skillset or advance your career or retrain to change jobs. Many employers also offer their workers the opportunity to gain qualifications as a way of retaining staff – for instance, through Strategic Education’s Degrees@Work programme.
8. Protection
Many people choose to take out critical illness cover which pays a lump sum on diagnoses of a covered condition, to help protect against unexpected financial hardship – for instance not being well enough to continue working. During the global coronavirus-driven lockdowns, British multinational insurer Prudential found that downloads of its digital health app more than trebled between early March and mid-May[11] and said it was expanding the number of products that could be sold virtually.
9. Self-care
Over the next 10 years, over 50% of the growth in consumer spending in developed countries is expected to come from the over-60s[12]. And most of us don’t just want to live longer, we want to live healthier for longer. Personal care is an important way we can contribute to this goal. Whether you’re buying Curel moisturising cream to care for your skin (owned by Japanese company Kao) or just topping up on everyday essentials such as Colgate (owned by Colgate-Palmolive), the 60-plus age group has significant spending power – and often more time to shop.
10. Leisure
Travel and tourism among the older generations is growing and it is estimated that by 2050 the over 60s will account for more than two billion trips annually[13]. It is undeniable that the coronavirus pandemic, has put immediate pressure on travel and tour operators. However, in many cases, travellers have already rescheduled their trips for 2021. For instance, Royal Caribbean Cruises said in May that bookings for 2021 are already in historical ranges and at higher prices compared to the same time in 2019.[14]
Despite the coronavirus outbreak, global populations continue to age, and we expect global life expectancies to creep higher over the longer term. So, although we may see some changes in consumption patterns post-COVID-19, the key drivers of the longevity economy remain intact. For investors with a longer-term investment horizon, these are key structural growth trends, which combined with shifting demographics can provide some interesting opportunities.
To learn more about this topic, please contact Rafael Tovar, Director, US Offshore Distribution, AXA IM.
Not for Retail distribution: This document is intended exclusively for Professional, Institutional, Qualified or Wholesale Clients / Investors only, as defined by applicable local laws and regulation. Circulation must be restricted accordingly.
This promotional communication does not constitute on the part of AXA Investment Managers a solicitation or investment, legal or tax advice. This material does not contain sufficient information to support an investment decision. Due to its simplification, this document is partial and opinions, estimates and forecasts herein are subjective and subject to change without notice. There is no guarantee forecasts made will come to pass. Data, figures, declarations, analysis, predictions and other information in this document is provided based on our state of knowledge at the time of creation of this document. Whilst every care is taken, no representation or warranty (including liability towards third parties), express or implied, is made as to the accuracy, reliability or completeness of the information contained herein. Reliance upon information in this material is at the sole discretion of the recipient. This material does not contain sufficient information to support an investment decision. Before making an investment, investors should read the relevant Prospectus and the Key Investor Information Document / scheme documents, which provide full product details including investment charges and risks. The information contained herein is not a substitute for those documents or for professional external advice. The products or strategies discussed in this document may not be registered nor available in your jurisdiction.
Please check the countries of registration with the asset manager, or on the web site https://www.axa-im.com/en/registration-map, where a fund registration map is available. In particular units of the funds may not be offered, sold or delivered to U.S. Persons within the meaning of Regulation S of the U.S. Securities Act of 1933. The tax treatment relating to the holding, acquisition or disposal of shares or units in the fund depends on each investor’s tax status or treatment and may be subject to change. Any potential investor is strongly encouraged to seek advice from its own tax advisors. AXA WF Global Strategic Bonds is a sub-fund of AXA World Funds. AXA WORLD FUNDS ‘s registered office is 49, avenue J.F Kennedy L-1885 Luxembourg. The Company is registered under the number B. 63.116 at the “Registre de Commerce et des Sociétés” The Company is a Luxembourg SICAV UCITS IV approved by the CSSF and managed by AXA Funds Management, a société anonyme organized under the laws of Luxembourg with the Luxembourg Register Number B 32 223RC, and whose registered office is located at 49, Avenue J.F. Kennedy L-1885 Luxembourg. The value of investments, and the income from them, can fall as well as rise and investors may not get back the amount originally invested. Exchange-rate fluctuations may also affect the value of their investment. Due to this and the initial charge that is usually made, an investment is not usually suitable as a short term holding. Issued in the UK by AXA Investment Managers UK Limited, which is authorised and regulated by the Financial Conduct Authority in the UK. Registered in England and Wales No: 01431068. Registered Office: 155 Bishopsgate, London, EC2M 3YD (until 31 Dec 2020); 22 Bishopsgate, London, EC2N 4BQ (from 1 Jan 2021).
Pixabay CC0 Public DomainFoto: Si Janko Ferlic. Foto: Si Janko Ferlic
The analysis from Pictet Asset Management’s research partner CIFS sheds light on the structural trends transforming the world, helping us build better investment portfolios.
Pictet Asset Management has been working with the Copenhagen Institute for Futures Studies (CIFS) for over a decade to establish a deeper understanding of megatrends – the powerful secular forces that are changing the environment, society, politics, technology and the economy. CIFS is a leading global think tank and consultancy. CIFS uses a wide range of research methods, developed over the last 40 years, which include megatrend analysis, scenario planning, risk management, innovation initiatives and strategy development.
Through our partnership with CIFS, we have devised an investment framework that incorporates CIFS’ 14 megatrends. The framework – which includes trends such as Demographic Development, the Network Economy, Focus on Health, Sustainability and Technology Development – enhances our thematic equity capabilities and informs the construction and development of our thematic equities strategies such as Water, Robotics or SmartCity.
As CIFS’ partner, Pictet Asset Management has access to research into areas not normally covered by the investment analyst community such as changes in societal attitudes and beliefs, the impact this has on the environment and the business sector, and the acceleration of technological development. We are proud to be associated with CIFS and would like to share some of their research with you.
For more information, please download the reports here, the reports are only available in English.
Important notes
This marketing material is issued by Pictet Asset Management (Europe) S.A.. It is neither directed to, nor intended for distribution or use by, any person or entity who is a citizen or resident of, or domiciled or located in, any locality, state, country or jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation. Only the latest version of the fund’s prospectus, KIID (Key Investor Information Document), regulations, annual and semi-annual reports may be relied upon as the basis for investment decisions. These documents are available on assetmanagement.pictet or at Pictet Asset Management (Europe) S.A., 15, avenue J. F. Kennedy, L-1855 Luxembourg.
The information and data presented in this document are not to be considered as an offer or solicitation to buy, sell or subscribe to any securities or financial instruments or services.
Information, opinions and estimates contained in this document reflect a judgment at the original date of publication and are subject to change without notice. Pictet Asset Management (Europe) S.A. has not taken any steps to ensure that the securities referred to in this document are suitable for any particular investor and this document is not to be relied upon in substitution for the exercise of independent judgment. Tax treatment depends on the individual circumstances of each investor and may be subject to change in the future. Before making any investment decision, investors are recommended to ascertain if this investment is suitable for them in light of their financial knowledge and experience, investment goals and financial situation, or to obtain specific advice from an industry professional.
The value and income of any of the securities or financial instruments mentioned in this document may fall as well as rise and, as a consequence, investors may receive back less than originally invested.
Past performance is not a guarantee or a reliable indicator of future performance. Performance data does not include the commissions and fees charged at the time of subscribing for or redeeming shares. This marketing material is not intended to be a substitute for the fund’s full documentation or any information which investors should obtain from their financial intermediaries acting in relation to their investment in the fund or funds mentioned in this document.
Any index data referenced herein remains the property of the Data Vendor. Data Vendor Disclaimers are available on assetmanagement.pictet in the “Resources” section of the footer.
This document is a marketing communication issued by Pictet Asset Management and is not in scope for any MiFID II/MiFIR requirements specifically related to investment research. This material does not contain sufficient information to support an investment decision and it should not be relied upon by you in evaluating the merits of investing in any products or services offered or distributed by Pictet Asset Management.
Wikimedia Commons. XP y Ashmore anuncian un acuerdo para ofrecer a inversores brasileños estrategias de mercados emergentes
XP Inc., a leading, technology-driven financial services platform, and Ashmore Group PLC, a specialist asset manager with over twenty-five years’ experience investing in Emerging Markets, announce a partnership to offer Brazilian investors easy access to actively-managed Emerging Markets equity and credit strategies.
XP recently launched three local feeder funds for qualified individual and institutional investors that invest directly into three Ashmore strategies: Ashmore Emerging Markets Debt Advisory FIC FIM IE CP (BRL hedged), Ashmore Emerging Markets Equity Dólar Advisory FIC FIA IE (unhedged-US) andAshmore Emerging Markets Equity Advisory FIC FIA IE (BRL hedged).
“Emerging Markets will continue to be the dominant drivers of global economic growth with highly attractive returns, particularly when set against the backdrop of persistently low interest rates in the developed world. Ashmore’s strategies, through the XP platform, provide Brazilian investors with the opportunity to diversify their portfolios and to enhance potential investment returns”, stated both companies in a shared statement.
Leon Goldberg, partner at XP said: “Through this partnership with Ashmore, XP is pleased to offer the first emerging markets strategies on its platform, easily accessible by clients through local funds. The choice of Ashmore, a global top-tier manager, as a partner reinforces our sense of continuous evolution and the search for international partnerships that support the idea of intelligent international portfolio diversification considering the excessively domestic bias still seen in investments in Brazil.”
George Grunebaum, Ashmore’s Head of Distribution for Latin America commented: “Ashmore is honoured to partner with XP to provide Brazilian investors with access to the attractive growth and return opportunities available across the Emerging Markets. Ashmore looks forward to sharing its specialist focus, active management philosophy and deep experience of investing in the Emerging Markets with XP in order to diversify and enhance its clients’ long-term investment returns.”
Ashmore is a specialist asset manager focused on Emerging Markets, with 83.6 billion dollars under management (as at 30 June 2020), and has a proven active management approach that has been tailored over more than two decades to deliver investment performance for clients. XP has outstanding distribution capabilities, coupled with educational engagement that guides investors in intelligent diversification that makes sense in the current domestic and international environment.
Foto cedidaAnnabel Spring, New CEO of Private Banking for HSBC. Annabel Spring, New CEO of Private Banking for HSBC
HSBC has named Annabel Spring as CEO of its recently merged global private banking business, an appointment that takes immediate effect, announced International Investment. Based in London, she will report to Charlie Nunn, CEO of HSBC’s Wealth and Personal Banking (WPB).
Spring joined the corporation in 2019 as group head of customer and products for WPB, where she has been responsible for HSBC’s international personal banking products and its Premier and Jade global services.
Previously, she worked nine years for the Commonwealth Bank of Australia, where her most recent title was group executive for wealth management. Spring also held senior roles at Morgan Stanley, including global head of firm strategy and execution.
HSBC also appointed Taylan Turan as group head of customers, products and strategy for the WPB division. He will remain group head of strategy while also assuming Spring’s former role.
Nunn said that both Spring and Turan will play “an important role” in accelerating the growth of HSBC’s business as they continue to invest in customer offering, technology and products. “As we operate in some of the fastest-growing wealth markets in the world, global private banking, a business with tremendous growth potential, is central to this ambition”, he added.
U.S. equities scored the best August since 1986 while setting a record high on Tuesday the 18th that made the thirty-three day coronavirus bear market of 2020, a 34% decline from February 19 – March 23, the shortest in market history. The new bull market is being fuelled by record fiscal and monetary stimulus, economic recovery and vaccine hopes and has rallied over 50% from the March low. What remains to be seen is if continued U.S. growth will suffice to end the current recession as one the sharpest and shortest on record as well.
In the fiscal cliff political arena, stimulus negotiations remain deadlocked with the Democrats recent rejection of the current $1.3 trillion Republican proposal. At month end, Evercore ISI’s economist Ed Hyman wrote in ‘Global V-Shaped Recovery’: Looking ahead, there are a number of factors that will lift US growth, eg, the surge in Consumer Net Worth, inventory rebuilding, the surge in vehicle production, the housing boom, reopening’s, and unprecedented global stimulus. A vaccine is likely…The US economy is starting a new expansion…The safest bet now is for a 5-year expansion with a 100% rally in the S&P. He may be right and we hope he is, but there will be some speed bumps along the way.
Following a major two-year review, Fed Chair Powell spoke at Jackson Hole on August 27th detailing the Fed’s conclusions for updating its monetary policy framework by moving to a flexible average inflation targeting (FAIT) approach.Bottom line: keep interest rates low to support a sustainable economic recovery. On August 19th, Barron’s financial writer Andrew Bary highlighted a G.research report on ViacomCBS (VIAC) by analyst John Tinker saying: ViacomCBS looks significantly undervalued based on the success of its streaming strategy and a potential sale of the company…Tinker’s view is that ViacomCBS is valued cheaply at just 6.5 times estimated 2020 earnings before interest, taxes, depreciation, and amortization (EBITDA). That compares with a price of 15 times Ebitda that Walt Disney (DIS) paid for Fox’s (FOXA) content assets in 2019 and a price of 13 times that AT&T (T) paid for Time Warner in 2018. Tinker’s ViacomCBS target equates to about eight times estimated 2021 EBITDA.
Since the March stock market low, value stocks, typically defined as cyclical or economically sensitive companies, have lagged growth stocks. We expect this to change as the economic recovery broadens and the value P/E discount narrows
Looking at the merger arb space, announced deals in July totaled $305 billion, a 60% increase from $189 billion in June, and essentially the same level of activity as July 2019. Sizeable M&A in July included Maxim Integrated’s acquisition by Analog Devices for $20 billion, Noble Energy’s acquisition by Chevron for $13 billion, and National General’s acquisition by Allstate Corp. for $4 billion.
Column by Gabelli Funds, written by Michael Gabelli
To access our proprietary value investment methodology, and dedicated merger arbitrage portfolio we offer the following UCITS Funds in each discipline:
GAMCO MERGER ARBITRAGE
GAMCO Merger Arbitrage UCITS Fund, launched in October 2011, is an open-end fund incorporated in Luxembourg and compliant with UCITS regulation. The team, dedicated strategy, and record dates back to 1985. The objective of the GAMCO Merger Arbitrage Fund is to achieve long-term capital growth by investing primarily in announced equity merger and acquisition transactions while maintaining a diversified portfolio. The Fund utilizes a highly specialized investment approach designed principally to profit from the successful completion of proposed mergers, takeovers, tender offers, leveraged buyouts and other types of corporate reorganizations. Analyzes and continuously monitors each pending transaction for potential risk, including: regulatory, terms, financing, and shareholder approval.
Merger investments are a highly liquid, non-market correlated, proven and consistent alternative to traditional fixed income and equity securities. Merger returns are dependent on deal spreads. Deal spreads are a function of time, deal risk premium, and interest rates. Returns are thus correlated to interest rate changes over the medium term and not the broader equity market. The prospect of rising rates would imply higher returns on mergers as spreads widen to compensate arbitrageurs. As bond markets decline (interest rates rise), merger returns should improve as capital allocation decisions adjust to the changes in the costs of capital.
Broad Market volatility can lead to widening of spreads in merger positions, coupled with our well-researched merger portfolios, offer the potential for enhanced IRRs through dynamic position sizing. Daily price volatility fluctuations coupled with less proprietary capital (the Volcker rule) in the U.S. have contributed to improving merger spreads and thus, overall returns. Thus our fund is well positioned as a cash substitute or fixed income alternative.
Our objectives are to compound and preserve wealth over time, while remaining non-correlated to the broad global markets. We created our first dedicated merger fund 32 years ago. Since then, our merger performance has grown client assets at an annualized rate of approximately 10.7% gross and 7.6% net since 1985. Today, we manage assets on behalf of institutional and high net worth clients globally in a variety of fund structures and mandates.
Class I USD – LU0687944552
Class I EUR – LU0687944396
Class A USD – LU0687943745
Class A EUR – LU0687943661
Class R USD – LU1453360825
Class R EUR – LU1453361476
GAMCO ALL CAP VALUE
The GAMCO All Cap Value UCITS Fund launched in May, 2015 utilizes Gabelli’s its proprietary PMV with a Catalyst™ investment methodology, which has been in place since 1977. The Fund seeks absolute returns through event driven value investing. Our methodology centers around fundamental, research-driven, value based investing with a focus on asset values, cash flows and identifiable catalysts to maximize returns independent of market direction. The fund draws on the experience of its global portfolio team and 35+ value research analysts.
GAMCO is an active, bottom-up, value investor, and seeks to achieve real capital appreciation (relative to inflation) over the long term regardless of market cycles. Our value-oriented stock selection process is based on the fundamental investment principles first articulated in 1934 by Graham and Dodd, the founders of modern security analysis, and further augmented by Mario Gabelli in 1977 with his introduction of the concepts of Private Market Value (PMV) with a Catalyst™ into equity analysis. PMV with a Catalyst™ is our unique research methodology that focuses on individual stock selection by identifying firms selling below intrinsic value with a reasonable probability of realizing their PMV’s which we define as the price a strategic or financial acquirer would be willing to pay for the entire enterprise. The fundamental valuation factors utilized to evaluate securities prior to inclusion/exclusion into the portfolio, our research driven approach views fundamental analysis as a three pronged approach: free cash flow (earnings before, interest, taxes, depreciation and amortization, or EBITDA, minus the capital expenditures necessary to grow/maintain the business); earnings per share trends; and private market value (PMV), which encompasses on and off balance sheet assets and liabilities. Our team arrives at a PMV valuation by a rigorous assessment of fundamentals from publicly available information and judgement gained from meeting management, covering all size companies globally and our comprehensive, accumulated knowledge of a variety of sectors. We then identify businesses for the portfolio possessing the proper margin of safety and research variables from our deep research universe.
Class I USD – LU1216601648
Class I EUR – LU1216601564
Class A USD – LU1216600913
Class A EUR – LU1216600673
Class R USD – LU1453359900
Class R EUR – LU1453360155
Disclaimer:
The information and any opinions have been obtained from or are based on sources believed to be reliable but accuracy cannot be guaranteed. No responsibility can be accepted for any consequential loss arising from the use of this information. The information is expressed at its date and is issued only to and directed only at those individuals who are permitted to receive such information in accordance with the applicable statutes. In some countries the distribution of this publication may be restricted. It is your responsibility to find out what those restrictions are and observe them.
Some of the statements in this presentation may contain or be based on forward looking statements, forecasts, estimates, projections, targets, or prognosis (“forward looking statements”), which reflect the manager’s current view of future events, economic developments and financial performance. Such forward looking statements are typically indicated by the use of words which express an estimate, expectation, belief, target or forecast. Such forward looking statements are based on an assessment of historical economic data, on the experience and current plans of the investment manager and/or certain advisors of the manager, and on the indicated sources. These forward looking statements contain no representation or warranty of whatever kind that such future events will occur or that they will occur as described herein, or that such results will be achieved by the fund or the investments of the fund, as the occurrence of these events and the results of the fund are subject to various risks and uncertainties. The actual portfolio, and thus results, of the fund may differ substantially from those assumed in the forward looking statements. The manager and its affiliates will not undertake to update or review the forward looking statements contained in this presentation, whether as result of new information or any future event or otherwise.
Foto cedida. Jean Hynes sucederá a Brendan Swords como consejero delegado de Wellington Management
Wellington Management has announced in a press release that Brendan Swords, Chief Executive Officer, will retire from Wellington on 30 June 2021. At that time, Jean Hynes, Managing Partner, will succeed him as CEO.
“One of the most enduring lessons of the Wellington partnership is the notion of stewardship, bringing along the next generation of leaders to allow us to better serve clients,” said Swords.
“I’m excited that Jean Hynes will be my successor. Over the course of her nearly 30 years at the firm, she has demonstrated the vision, optimism, and fortitude to lead Wellington in the years ahead. Her extensive investment and leadership experience align with our mission of delivering investment excellence to our clients”, he added.
Meanwhile, Hynes claimed to be “humbled and honored” to be the next CEO of Wellington Management. “I have had the privilege of learning alongside Brendan for many years, and I am looking forward to building on our long heritage of helping our clients and their beneficiaries around the world achieve their investment goals”, she said.
Hynes joined the firm in 1991 after graduating from Wellesley College with a BA in economics. Throughout her nearly 30 years at the firm, she has researched the pharmaceutical and biotechnology industries, as well as served as a healthcare portfolio manager and leader of this sector’s research team. Since 2014, she has served as one the firm’s three Managing Partners alongside Swords. Hynes is a member of the Investment Committees at Wellesley College and the Winsor School.
