The Fund declined in absolute value in the September quarter and underperformed the index retum. Themes are discussed below in order of contribution.
Data and At: Bullish sentiment about artificial intelligence (AI) was a broad tailwind for holdings in this theme, led by Alphabet, RELX and
Mastercard. Alphabet introduced Duet Al (similar to Microsoft’s Copilot) that allows for live integration of customer data.
Software as a Standard: Bullish Al sentiment was also a broad tailwind for holdings in the theme. Intuit, Adobe, and Autodesk rose the most on robust operating results.
Energy Transitions: Integrated Energy holdings, TotalEnergies, BP, Shell, and Equinor, advanced in sympathy with the rise in the price of oil, as OPEC tightened supply whilst global demand remains robust.
Future Health: UnitedHealth and Danaher advanced with the stabilisation in recent operational challenges. Changes in Chinese regulations potentially favoring domestic suppliers represented a headwind for medical technology companies, including Siemens Healthineers.
Sustainable Solutions: Jacobs traded higher on strong engineering services demand. Avery Dennison climbed on signs of improvements
in the inventory situation impacting its radio frequency identification (RFID) products. Nutrien gained in sympathy with the rise in the price of agricultural products
Scarce Commodities; Anglo American and Antofagasta outperformed with robust commodity prices. Gold miners, led by Barrick Gold declined in sympathy with the fall in gold prices due to a strengthening US dollar and higher bond yields
Digital Runway DBS advanced with the ongoing rise in US interest rates and robust operating results.
Enduring Brands: Spirits holdings, Pernod Ricard, Diageo, and Rémy Cointreau, declined the most on additional China-related demand weakness and high US channel inventories.
What is Zurich Investments Hgd Gbl Thematic Shr Zurich Investments Hgd Gbl Thematic Shr is an Managed Funds investment product that is benchmarked against Developed -World Index and sits inside the Foreign Equity - Currency Hedged Index. Think of a benchmark as a standard where investment performance can be measured. Typically, market indices like the ASX200 and market-segment stock indexes are used for this purpose. The Zurich Investments Hgd Gbl Thematic Shr has Assets Under Management of 11.11 M with a management fee of 0.98%, a performance fee of 0 and a buy/sell spread fee of 0.08%.
How has the investment product performed recently?
The recent investment performance of the investment product shows that the Zurich Investments Hgd Gbl Thematic Shr has returned 1.29% in the last month. The previous three years have returned 3.24% annualised and 13.73% each year since inception, which is when the Zurich Investments Hgd Gbl Thematic Shr first started.
How is risk measured in this investment product?
There are many ways that the risk of an investment product can be measured, and each measurement provides a different insight into the risk present. They can be used on their own or together to perform a risk assessment before investing, but when comparing investments, it is common to compare like for like risk measurements to determine which investment holds the most risk. Since Zurich Investments Hgd Gbl Thematic Shr first started, the Sharpe ratio is NA with an annualised volatility of 13.73%. The maximum drawdown of the investment product in the last 12 months is -2.69% and -40.64% since inception. The maximum drawdown is defined as the high-to-low decline of an investment during a particular time period.
What is the relative performance of the investment product?
Relative performance is what an asset achieves over a period of time compared to similar investments or its peers. Relative return is a measure of the asset's performance compared to the return to the other investment. The Zurich Investments Hgd Gbl Thematic Shr has a 12-month excess return when compared to the Foreign Equity - Currency Hedged Index of -5.15% and -0.23% since inception.
Does the investment product produce Alpha over its Peers?
Alpha is an investing term used to measure an investment's outperformance relative to a market benchmark or peer investment. Alpha describes the excess return generated when compared to peer investment. Zurich Investments Hgd Gbl Thematic Shr has produced Alpha over the Foreign Equity - Currency Hedged Index of NA% in the last 12 months and NA% since inception.
What are similar investment products?
For a full list of investment products in the Foreign Equity - Currency Hedged Index category, you can click here for the Peer Investment Report.
What level of diversification will Zurich Investments Hgd Gbl Thematic Shr provide?
Zurich Investments Hgd Gbl Thematic Shr has a correlation coefficient of 0.96 and a beta of 0.91 when compared to the Foreign Equity - Currency Hedged Index. Correlation measures how similarly two investments move in relation to one another. This establishes a 'correlation coefficient', which has a value between -1.0 and +1.0. A 100% correlation between two investments means that the correlation coefficient is +1. Beta in investments measures how much the price moves relative to the broader market over a period of time. If the investment moves more than the broader market, it has a beta above 1.0. If it moves less than the broader market, then the beta is less than 1.0. Investments with a high beta tend to carry more risk but have the potential to deliver higher returns.
How do I compare the investment product with its peers?
For a full quantitative report on Zurich Investments Hgd Gbl Thematic Shr and its peer investments, you can click here for the Peer Investment Report.
How do I compare the Zurich Investments Hgd Gbl Thematic Shr with the Developed -World Index?
For a full quantitative report on Zurich Investments Hgd Gbl Thematic Shr compared to the Developed -World Index, you can click here.
Can I sort and compare the Zurich Investments Hgd Gbl Thematic Shr to do my own analysis?
To sort and compare the Zurich Investments Hgd Gbl Thematic Shr financial metrics, please refer to the table above.
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Comments from SMSF Mates
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Performance Commentary - August 31, 2023 The Fund produced a negative absolute return in August in Australian dollar terms and was unable to keep pace with the index return. Themes are discussed below in order of contribution.
Software as a Standard: Bullish sentiment about artificial intelligence (AI) continued to be broad tailwinds for the theme with Intuit, Adobe, and Autodesk rising most. Intuit and Autodesk also reported strong operating results, with the former surprising the market with strength in its QuickBooks and Credit Karma businesses and the latter with resiliency in its subscription model and renewals amidst macroeconomic headwinds.
Data and AI: Bullish sentiment about AI and data-related companies remain a broad tailwind for holdings in this theme such as Mastercard, Alphabet, and Visa. At its Cloud Next event, Alphabet introduced Duet AI (similar to Microsoft’s Copilot), that allows for live integration of customer’s data.
Sustainable Solutions: AZEK rose on better-than-feared sell-through in the US residential market, ongoing reduction in inventory, and margin expansion coming through from its cost saving initiatives. Jacobs gained on ongoing engineering services demand from its semiconductor, biotech, and electric vehicle clients and on increasing interest in the sale of its Critical Mission Solutions (CMS) business.
Future Health: Danaher gained on news it plans to acquire Abcam, a life science company specialising in antibodies. Siemens Healthineers retreated with operating results showing weaknesses in its imaging and Varian businesses.
Energy Transitions: Integrated energy holdings, BP and Total, climbed in sympathy with the rise in the price of oil. Vestas traded lower on slow orders and industry challenges with renewable developers (e.g. Orsted).
Enduring Brands: Spirits holdings, Pernod Ricard and Remy Cointreau, dropped on China-related weakness. Pernod Ricard also pointed to further weakness in the US, with dampening demand for on-trade channels.
Scarce Commodities: Antofagasta dropped on higher-than-expected medium-term capital expenditure spending. Anglo American receded due to ongoing operational challenges at some of its mines.
Digital Runway: Rising domestic macroeconomic concerns impacted China-exposed holdings, with Ping An Insurance, Prudential, and AIA declining most.
Smart Capex: Caterpillar traded higher on strong order trends and easing of concerns related to dealer inventory. Johnson Controls fell on worsening destocking trends and higher-than-expected amortisation expense.
Performance Commentary - July 31, 2023 The Fund produced a positive absolute return in July but was unable to keep pace with the strong index return. Themes are discussed below in descending order of contribution.
Software as a Standard: Adobe, Intuit, and Salesforce were the top contributors within this theme, as bullish sentiment about artificial intelligence (AI) continued to provide a strong positive tailwind. Microsoft declined with ongoing optimization of broader cloud and IT spending.
Data and AI: Alphabet rose on robust operating results, highlighting both revenue acceleration and cost control and on excitement around further integrating AI into its advertising and search products. Tencent advanced as part of a broader gains made by Chinese equities, thanks to expectations on further stimulus measures.
Empowered Consumer: Alibaba climbed on expectations for a recovery in Chinese consumption demand driven by policy support.
Reliance Industries rose on market share gains in its consumer-oriented businesses, particularly in groceries and media. Estée Lauder faltered after reporting a cybersecurity incident that may cause further disruption to parts of its business operations. Live Nation fell on rumours that the Justice Department may file an antitrust lawsuit against the company.
Sustainable Solutions: Nutrien gained with strong crop prices and expectations of a recovery in fertilizer demand. Avery Dennison rose on expectations for a faster end to customer destocking. Jacobs traded higher on strong demand on construction end market. Waste Management fell on weaker recycling and special waste volumes and delays to permitting of its sustainability investment projects. PPG declined on weakness in its coating and European businesses.
Scarce Commodities: Miners Antofagasta and Anglo American advanced in sympathy with the rise in the price of copper.
Bits of Chips: Infineon and Aptiv climbed on strong first half auto production volume. Applied Materials gained on optimism around opportunities surrounding broader adoption of AI. Keysight retreated on weakness in broader data centre spending. Taiwan Semiconductor Manufacturing Company receded on slower demand recovery, inventory correction, and delays in the production schedule of its Arizona N4 fab.
Digital Runway: Promise of further government stimulus targeting Chinese consumption boosted China-exposed holdings Ping An Insurance and DBS. ICICI rose on acceleration in loans and deposit growth.
Enduring Brands: Remy Cointreau advanced on quarterly results showing signs of the end of its inventory correction.
Future Health: UnitedHealth rose on better-than-expected operating results after previously warning about higher medical loss ratio (MLR). Zoetis climbed following positive news flow about its heartworm disease franchise. Danaher and Thermo Fisher both advanced on expectations of a demand upcycle, thanks to an improving biotech funding environment.
Energy Transitions: Integrated energy holdings BP and Total advanced in sympathy with the rise in the price of oil. Iberdrola declined after raising additional capital via green bond issuance.
Smart Capex: Caterpillar rose on dealer inventory replenishment, positive business mix, and strength in its construction business.
Hexagon traded lower after a short seller report. Fanuc fell on weak orders in its robotics division and inventory destocking. Honeywell receded on weakness in its shorter-cycle Building Technologies and Safety & Productivity Solutions businesses. Cognex faltered on concerns about potential slowdown in warehouse automation demand.
Performance Commentary - June 30, 2023 The Fund produced a solid absolute return in the June quarter but was unable to keep pace with the impressive index return. The top performing themes are discussed below in order of contribution.
Software as a Standard: Positive news flow and product demonstrations of the integration of new generative AI tools into software products benefited holdings, with Microsoft and Adobe rising the most. PTC, SAP, and Salesforce also rose. Asset Efficiency: Robust demand, easing supply-chain headwinds and market expectations for AI-driven automation growth led to rises in Johnson Controls, Cognex, Rockwell, and Schneider.
Data, Networks & Profits: Alphabet rose on expectations for faster adoption of generative AI and integration within its suite of products. Sustainable Solutions: AZEK rose on expectations for cyclical recovery following channel destocking of decking inventory and easing of raw materials inflation. Ecolab and PPG rose on easing supply chain impact. Empowered Consumer: Amazon rose on stronger-than-expected retail sales data and expectations for higher demand for cloud infrastructure due to broader adoption of generative AI.
Bits of Chips: Anticipation of increased AI-related semiconductor spending drove higher share prices at Applied Materials and TSMC. Aptiv declined on continued supply chain-driven margin pressure.
Digital Runway: Bank Rakyat climbed on continued growth in micro-banking and expectations for monetary easing from Indonesia’s central bank.
The theme Extreme Risks is evolving into a new theme, Scarce Commodities. The Fund’s global framework identifies extreme monetary and fiscal policy as a key feature of today’s investment landscape. Gold and gold mining equities were utilised in the Extreme Risks theme as quasi-real assets that should rise in nominal terms during currency debasement, and US banks were included as a hedge against the likely policy response of higher rates and potentially higher long-term bond yields. While conviction in the theme has increased, the implementation of the theme is evolving. Gold and gold mining equities will be retained, but the exposure to US banks has been retired on concerns regarding the potential for stronger capital requirements, more regulation and tougher competition for deposits. The investment team feel more confident in the ability of the broader commodity complex to benefit from the policy drivers identified in the Fund’s Global Framework. Demographic-led consumption in emerging markets, alongside huge government-spending programs in the West focused on green infrastructure, represent a compelling demand opportunity. But what makes the situation particularly potent are deeply embedded supply constraints after years of underinvestment and disincentives to build new capacity. This combination offers significant upside asymmetry for companies who own underlying resources and capacity. Commodities such as copper are a good example of this policy support and scarce supply, and the investment team has subsequently added two new holdings to this theme—Anglo American and Antofagasta.
Performance Commentary - May 31, 2023 The Fund fell in May in absolute terms and underperformed the index return. Themes are discussed below in descending order of contribution.
Software as a Standard: Positive news flow and product demonstrations of the integration of new generative artificial intelligence tools into software products benefited holdings with Microsoft, Adobe, Salesforce, and Accenture rising most.
Bits of Chips: Applied Materials and Taiwan Semiconductor Manufacturing Company rose on bullish sentiment about the demand outlook for semiconductors linked to artificial intelligence (AI). Keysight gained on strength in automotive and industrial end markets.
Asset Efficiency: Cognex traded higher on easing supply chain headwinds and on market rotation towards technology and companies with exposure to artificial intelligence.
Data, Networks & Profits: Alphabet rose on expectations for faster adoption of generative AI and integration within its suite of products. Wolters Kluwer traded lower on weaker margins and market rotation.
Empowered Consumer: Amazon rose on stronger-than-expected retail sales data and expectations for higher demand for cloud infrastructure, with broader adoption of generative AI. Live Nation advanced on robust operating results showing less cyclicality in demand for live events.
Digital Runway: Bank Rakyat climbed on continued growth in micro banking and expectations for monetary easing from Indonesia’s central bank.
Extreme Risks: In the aftermath of three of the largest bank failures in US history occurring in the last two months, lenders PNC and Truist Financial fell on ongoing concerns about the stability of the US banking sector. Both positions were liquidated early in May.
First World Health: Medical device companies Siemens Healthineers, Thermo Fisher, Stryker, and Olympus all declined on worries about a weakened demand outlook. Olympus was sold on further idiosyncratic risks around increased compliance costs imposed by the US Food and Drug Administration.
Sustainable Solutions: Nutrien faltered on disappointing Potash and retail sales. AZEK declined on concerns about a weak demand outlook for US residential construction and remodelling.
Energy Transitions: Integrated energy holdings BP, Iberdrola, Shell, and Equinor all fell in sympathy with the fall in the price of oil, as a stronger US dollar and weak data from China, the world’s top oil importer, fuelled concerns about demand.
Enduring Brands: Beiersdorf, Unilever, and Remy Cointreau all receded as part of a larger rotation away from the consumer staples stocks.
Performance Commentary - April 30, 2023 The Fund produced a solid return in April though was marginally behind the strong index return. For the 12 months to 30 April 2023, the Fund is ahead of the index return by 0.85%. Themes are discussed below in order of contribution.
Enduring Brands: Consumer staples holdings, led by Beiersdorf, Unilever, Nestle, and Colgate-Palmolive, rose on strong volume and pricing data, along with the easing of raw materials cost inflation.
Energy Transitions: Integrated energy holdings Total and BP gained after OPEC announced it would cut production by 1.1 million barrels per day, more than the market expected.
Digital Runway: Pan-Asian insurer Prudential rose, thanks to a sales recovery in Hong Kong and mainland China. Indonesian lenders Bank Central Asia and Bank Rakyat advanced on declining credit costs.
Sustainable Solutions: AZEK rose on expectations for cyclical recovery in the wake of channel destocking of decking inventory and easing of raw materials inflation.
Data, Networks & Profits: Marsh & McLennan rose on strength in its Risk and Insurance Services division and higher fiduciary income helped by a rise in short-term rates. Market rotation and the potential of artificial intelligence were tailwinds for the theme, benefiting holdings Wolters Kluwer, RELX, and S&P Global.
Empowered Consumer: EssilorLuxottica advanced on broad-based strength in operating results across all geographical regions as customers continue to show no signs of trading down. Electronic Arts climbed on strength in its FIFA franchise.
First World Health: Medical device companies Siemens Healthineers, Stryker, and Boston Scientific traded higher on expectations for easing cost pressures and a demand recovery for elective procedures.
Extreme Risks: Agnico Eagle climbed on re-affirmed production guidance and lower-than-expected operating cost.
Software as a Standard: Microsoft rose on better-than-expected quarterly results in its cloud division, as new workloads are starting to offset cost optimization. SAP appreciated on progress in its cloud transition and margin improvement. Autodesk traded lower on expectations for macroeconomic impact to subscriber growth and contract renewal.
Asset Efficiency: Schneider and Honeywell advanced on strength in its energy management and aerospace businesses respectively and on higher revenue visibility from elevated backlogs.
Bits of Chips: Profit-taking pressure and cyclical concerns for semiconductor demand and capex spending contributed to broad-based weakness within the theme with Infineon, Keysight, and Texas Instruments declining most.
Performance Commentary - March 31, 2023 The Fund produced a solid absolute return in the March quarter but was unable to keep pace with the strong index return. For the 12 months to 31 March 2023, the Fund is comfortably ahead of the index return. Themes are discussed below in descending order of contribution.
Software as a Standard: Software stock holdings broadly rose, thanks to the decline in bond yields and perceived earnings stability.
Salesforce rose most on strong quarterly results indicating robust demand and news that management will impose cost controls in a longawaited move to improve profit margins. Microsoft traded higher on bullish sentiment about its initiatives in artificial intelligence (AI).
Bits of Chips: Continued strength in automotive and industrial end markets, anticipation of increased spending from an AI arms race, and signs of a bottom in weaker segments, such as memory, drove a broad rally in semiconductor stocks.
Taiwan Semiconductor Manufacturing Company, Applied Materials, and Infineon were the top performers.
Data, Networks, and Profits: Wolters Kluwer and RELX rose on accelerating organic growth, driven by new product innovation. Tencent traded higher as results showed a return to growth. Alphabet rose on market rotation and anticipation of new growth opportunities from integrating AI into its product suite.
Sustainable Solutions: Rentokil gained on strong quarterly results and reduced concerns over termite litigation in the wake of its merger with Terminix. Ecolab gained on strong pricing trends in its operating results.
Empowered Consumer: LVMH and Alibaba gained on expectations that the companies will benefit from the resumption of Chinese discretionary spending in the wake of China’s economic re-opening. Shares of Alibaba received another boost on news of its plans to split into six units.
Enduring Brands: Pernod Ricard advanced on strong results, with pricing power and low demand elasticity. Beiersdorf and Reckitt Benckiser rose on robust results.
Energy Transitions: Integrated energy holding BP rose on results showing high levels of cash generation and buybacks. Linde and Air Liquide gained on strong backlogs.
Asset Efficiency: Fanuc gained most on improved robotics margins in results. Schneider and Rockwell advanced on continued strong organic growth in quarterly results. Honeywell declined on management change.
First World Health: Medical device holdings, led by Stryker, Siemens Healthineers, and Zoetis, traded higher as medical activity and inflation normalises.
Performance Commentary - February 28, 2023 The Fund fell in February and was unable to outperform the index return. Themes are discussed below in order of contribution. Energy Transitions: Integrated energy holdings BP and Shell rose on results showing high levels of cash generation and capital discipline. Linde also gained as it completed its re-listing in the US. Bits of Chips: Analog Devices, Applied Materials and Dolby all advanced on strong quarterly results and continued demand in industrial and automotive end markets. Aptiv traded higher on medium-term guidance at its analyst day. Keysight declined on results showing a deceleration from strong demand for 5G testing.
Sustainable Solutions: Ecolab gained on strong pricing trends in its operating results. Kerry climbed on continued volume growth in its food service segment. Enduring Brands: Pernod Ricard rose on strong results, with pricing power and low demand elasticity. First World Health: Stryker and Boston Scientific traded higher as medical activity normalizes. Olympus and IQVIA declined on weak quarterly results. Digital Runway: Indian and Indonesian banks rose with strong loan growth, led by HDFC Bank and Bank Central Asia. China-related holdings, led by Ping An Insurance, declined in a reversal of January trends on concerns that the rebound in China’s economic activity will take longer than anticipated in the aftermath of the Chinese government abandoning its “zero COVID” policy. Asset Efficiency: Rockwell advanced on strong organic growth in quarterly results.
Cognex traded lower as results showed a pause in demand from large warehouse automation customers. Software as a Standard: Microsoft traded higher on well-received communication about its initiatives in artificial intelligence. Adobe faltered on regulatory challenges to its acquisition of Figma. Data, Networks, and Profits: Wolters Kluwer rose on accelerating organic growth, thanks to new product innovation. Tencent traded lower as part of a larger decline in Chinese equities. Alphabet slid on concerns over increased competition from Microsoft in search. Extreme Risks: Gold miners Agnico Eagle and Newmont in sympathy with the softening in the price of gold after recent strength, concerns about margin pressure stemming from high costs reported in the company’s quarterly results, and the acquisition of Newcrest by competitor Newmont.
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