Maintaining Order in Complexity

The Europe Quality Fund returned 4.33% in November outperforming its index by 1.63%. The Health Care sector was the largest contributor to alpha, mostly due to stock selection. Stock selection for the Materials sector was also a significant contributor. The best performing sectors for the index over the month were Information Technology, Industrials, and Health Care; while Utilities, Communication Services, and Energy were the worst performing sectors.

Monthly Fund Commentary
24 Dec 2019

The Europe Quality Fund returned 4.33% in November outperforming its index by 1.63%. The Health Care sector was the largest contributor to alpha, mostly due to stock selection. Stock selection for the Materials sector was also a significant contributor. The best performing sectors for the index over the month were Information Technology, Industrials, and Health Care; while Utilities, Communication Services, and Energy were the worst performing sectors.

At a single stock level the best performing stocks for the European Fund were Qiagen, Intl Flavors & Fragrances, and Siemens Healthineers. There were no noteworthy detractors over the period.

 

The Global Quality Fund returned 0.51% in November, compared to 2.79% for the benchmark. The largest detractor to alpha was the Consumer Staples sector, primarily due to stock selection. The main contributor was the Materials sector, due to Intl Flavors & Fragrances. The best performing sectors for the index over the month were Information Technology, Health Care, and Industrials; while Utilities, Real Estate, and Consumer Staples were the worst performing sectors.The best performing stock for the Global Fund was Intl Flavors & Fragrances; while Shiseido was the bottom performer.

The complexity of the world is increasing not just from an economic point of view but also from a political perspective. The Investment Adviser believes stars are aligning for a difficult period given that it has now become more likely that the globe is facing a synchronised economic slowdown. Given this macro and political backdrop, the Team will maintain their preference for defensive portfolio positioning into the end of the year.

 

The views and statements contained herein are those of the Eric Sturdza Group in their capacity as Investment Advisers to the Funds as of 18/12/2019 and are based on internal research and modelling