Top Picks – Funds Selection – June 2023

We are showing here a selection of funds that might be of interest to you, either due to their recent outstanding performance, the attractive return potential or diversification benfit they may offer in the given market conditions.

In May, all major asset classes declined, including in alternatives, erasing part of the 2nd quarter gains. The US debt ceiling debate during the month raised risk aversion. Lingering concerns around recession and again rate hike expectations also focused investors’ attention.

Equities

Within equities, the technology sector was the name of the game last month sending the Nasdaq +5.8% higher (+23.6% YTD). Elsewhere, investors were more cautious and most equity markets ended May in negative territory, particularly China and Europe.

The energy sector also experienced a difficult month supporting active managers broadly, most of them being underweight in this area for ESG purpose.

Unsurprisingly, Threadneedle Global Technology fund was the best performer on absolute +9,7%, but it also managed to outperform its benchmark by (+148 bps).

Sustainable equities also displayed sound alpha generation, particularly Janus Henderson Global Equity Sustainable (+263 bps) and Liontrust GF Sustainable Future Global Growth (+229 bps). The Thematics Safety fund (+294 bps) benefitted from its exposure to the tech sector.

In Europe, Berenberg European Focus (+242 bps) and Sycomore Social Impact (+172 bps) proved to be the more defensive funds.

Fixed Income

Persistent rate hike expectations and sticky inflation weighted on government bonds across many maturities. Corporate bonds were also under pressure in May, particularly the Investment Grade.

The AXA WAVE Cat Bonds displayed the best performance on absolute +1,39% and on a relative basis (+96 bps). Invesco Global Investment Grade fund (+39 bps) managed to cushion the market downturn in this sub asset-class.

The selection in the EM debt space continues de deliver solid returns across the whole spectrum, both hard and local currency.  Vontobel EM Debt (+47 bps) and Barings EM Local Debt (+34 bps) managed to outperform their respective benchmarks in May.

*Performance figures in bracket are monthly alpha compared to respective funds’ benchmark, not absolute performance.

Performance figures in bracket are monthly alpha compared to respective funds’ benchmark, not absolute performance.

All the mentioned funds are exclusively extracted from our OpenList service, a fund selection list for use by Wealth Managers in Switzerland.

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