VAM Managed Funds (Lux) Commentaries

February 2019 (click to download)

VAM DRIEHAUS FUND

As proxies for larger, broad equity exposures, note that the MSCI All Country World Index was up 2.67% and the S&P 500 was up 3.21% for the full month. On a relative basis, the VAM Driehaus Fund’s returns were supported by its exposure to US smaller capitalisation equities while its emerging markets exposures underperformed the broad market.

 

Equity markets generally continued their rally during the month, as anticipation of a trade resolution and accommodating central bank policy supported a risk on environment. Similar to last month’s comments, if the US economy stabilises, 2019 economic growth and corporate earnings growth could surprise. However, global economic activity is slowing. Investors should be mindful of the economic and geopolitical uncertainties that persist around the globe and be prepared for equity market volatility.

VAM DISCRETIONARY FUNDS

VAM Close Brothers Cautious Fund

The global stock markets continued to recover from their year-end 2018 sell-off, albeit at a slower pace than in January. Global growth has weakened somewhat, but the Manager expects earnings growth to remain positive and, despite elevated geopolitical risk, the Manager believes this is an environment favouring shares over bonds. Within its regional equity allocation, the Manager is cautious on UK shares and favours those regions most attractively positioned to benefit from the improvement in the global growth dynamic, such as Asia and Emerging Markets.

 

Within equities, notable performance came from the JP Morgan US Equity Income Fund, which rose 3% over the month, ahead of the wider US market which rose 2.2%. The Fund’s fixed interest exposure also contributed to performance over the month with, for instance, Schroder Strategic Credit up 1% and Blackrock Strategic Bond up 0.9%. Elsewhere, the alternatives exposure was more mixed with F&C Commercial Property down -5.3% whilst GCP Infrastructure and INPP Infrastructure were up 2.1% and 2.5%, respectively.

VAM Close Brothers Balanced Fund

The global stock markets continued to recover from their year-end 2018 sell-off, albeit at a slower pace than in January. Global growth has weakened somewhat, but the Manager expects earnings growth to remain positive and, despite elevated geopolitical risk, the Manager believes this is an environment favouring shares over bonds. Within its regional equity allocation, the Manager is cautious on UK shares and favours those regions most attractively positioned to benefit from the improvement in the global growth dynamic, such as Asia and Emerging Markets.

 

Within equities, notable performance came from the Baillie Gifford American Fund, which rose 8.1% over the month, well ahead of the wider US market which rose 2.2%. The Fund’s fixed interest exposure also contributed to performance over the month with, for instance, Nomura Dynamic Bond up 1.4% and Blackrock Strategic Bond up 0.9%. Elsewhere, the alternatives exposure was more mixed with BMO Global Equity Market Neutral down -10.1% whilst BBGI Infrastructure and INPP Infrastructure were up 3.1% and 2.5%, respectively.

VAM Close Brothers Growth Fund

The global stock markets continued to recover from their year-end 2018 sell-off, albeit at a slower pace than in January. Global growth has weakened somewhat, but the Manager expects earnings growth to remain positive and, despite elevated geopolitical risk, the Manager believes this is an environment favouring shares over bonds. Within its regional equity allocation, the Manager is cautious on UK shares and favours those regions most attractively positioned to benefit from the improvement in the global growth dynamic, such as Asia and Emerging Markets.

 

Within equities, notable performance came from the Baillie Gifford American Fund, which rose 8.1% over the month, well ahead of the wider US market which rose 2.2%. The Fund’s fixed interest exposure also contributed to performance over the month with, for instance, Fidelity Strategic Bond up 1.2% and Blackrock Strategic Bond up 0.9%. Elsewhere, the alternatives exposure was more mixed with BMO Global Equity Market Neutral down -10.1% whilst BBGI Infrastructure and INPP Infrastructure were up 3.1% and 2.5%, respectively.

Sources: Driehaus Capital Management LLC and Close Brothers Asset Management.
Close Brothers Asset Management is a trading name for Close Asset Management Limited.

 

Disclaimer

VAM Driehaus, VAM Close Brothers Cautious, Balanced and Growth Funds are compartments of VAM Managed Funds (Lux).

This document is intended for use by professional financial advisers only. The distribution of VAM Funds and the offering of the shares may be restricted in certain jurisdictions. Private investors should contact their financial adviser for more details on any of the products featured. It is the responsibility of any person in possession of this document to inform themselves of, and to observe, all applicable laws and regulations of any relevant jurisdictions. Prospective applicants for shares should inform themselves as to the legal requirements and consequences of applying for, holding and disposing of shares and any applicable exchange control regulations and taxes in the countries of their respective citizenship, residence or domicile. Click for Important Information