The equity fund ERSTE FAIR INVEST invests globally with a focus on shares from companies whose benefit for society has been identified on the basis of a pre-defined selection process.

Turbulent first half year on the markets

The sentiment on the equity and bond markets was clearly down in the first half of 2022. Numerous factors are driving the current affairs at the moment. For example, inflation has increased significantly since the end of last year, which led the central banks like the Federal Reserve in the USA and the European Central Bank (ECB) to take action. In reaction to the drastic increase in inflation, the central banks tightened their monetary policy and heralded the end of low interest rates. The Ukraine war and increasing geopolitical tensions are also burdening share and bond prices.

The situation created by these three factors has increasingly led to concerns about economic growth, which is also reflected in the economic data. The development of the market environment in the second half of 2022 should therefore depend crucially on the path of inflation. Due to strong base effects, experts suggest that inflation might peak in autumn. The development of the Ukraine war from here on out will also remain an uncertainty factor for the rest of the year. Given this context, the risk of a recession is particularly high in Europe at this point in time.

For more information on a regular basis, please visit the investment blog of Erste Asset Management. Here, you can find not only articles and comments on the status quo of the market, but also interviews with experts of Erste Asset Management and interesting facts about funds and investments.

In the exclusive interview below about the first half of 2022, fund manager Bernhard Selinger talks about his assessment of the YTD performance of the fund and his outlook for the coming months.

Interview with fund manager Bernhard Selinger


What sort of performance did the fund achieve in the first half of 2022?

As equity fund with global focus, ERSTE FAIR INVEST was unable to escape the volatility on the equity markets amid general concerns about economic growth resulting from the interest rate reversal we experienced in the first half of 2022. These concerns are the consequence of a strong inflation momentum, ongoing supply chain problems in the corporate sector, and the turbulences caused by the conflict between Russia and Ukraine.

The two Asian financials, Bank Rakyat (Indonesia) and Kasikornbank (Thailand), stood out in this difficult environment; they excelled in the ESG field of “social” (S), engaging in the area of microloans and focusing on financial inclusion. We would also like to mention Aier Eye Hospital, an operator of ophthalmic clinics based in China, which benefits from an increasing political focus on eyecare. The company operates about 600 eyecare branches in Asia, Europe, and the USA, and pursues philanthropic interests in many emerging markets across South East Asia.

How is ERSTE FAIR INVEST currently positioned? What is your focus in this fund?

ERSTE FAIR INVEST is an impact fund. This means that we want to contribute positively to society and to achieve changes for the better. The goal is to invest in solid, well-managed companies that contribute to the social aspect of ESG (“S”) with their products and services.

The focus of the fund, in terms of themes, is on healthcare and well-being, work (e.g. equal opportunities, diversity and inclusion), and society (e.g. education, microloans, financial literacy).

Bernhard Selinger

(c) Photo: Stephan Huger

„The times are definitely challenging on the equity markets, but due to our long-term horizon, weaknesses often translate into opportunities to invest.”

Bernhard Selinger, fund manager ERSTE FAIR INVEST

What is the outlook for the fund in the coming months?

The times are definitely challenging on the equity markets, but due to our long-term horizon, weaknesses often translate into opportunities to invest.

The underlying idea of the fund remains valid: we invest in solid and successful companies that assume social responsibility vis-à-vis all stakeholders (employees, suppliers, customers, society). These companies therefore do not only do the right thing, they are also financially successful in doing it.

This makes sense from an intuitive point of view: well trained and satisfied employees and the absence of corporate scandals that would drain financial resources and cause reputational harm are a good basis for corporate success.

Performance chart since fund inception

Important legal note:

Due to the very short term, this presentation of the performance is not very meaningful.

Disclaimer

This document is an advertisement. All data is sourced from Erste Asset Management GmbH, unless indicated otherwise. Our languages of communication are German and English.

The prospectus for UCITS (including any amendments) is published in Amtsblatt zur Wiener Zeitung in accordance with the provisions of the InvFG 2011 in the currently amended version. Information for Investors pursuant to § 21 AIFMG is prepared for the alternative investment funds (AIF) administered by Erste Asset Management GmbH, pursuant to the provisions of the AIFMG in connection with the InvFG 2011.

The fund prospectus, Information for Investors pursuant to § 21 AIFMG, and the key investor document/KID can be viewed in their latest versions at the  web site www.erste-am.com within the section mandatory publications  or obtained in their latest versions free of charge from the domicile of the management company and the domicile of the custodian bank. The exact date of the most recent publication of the fund prospectus, the languages in which the key investor document is available, and any additional locations where the documents can be obtained can be viewed on the web site www.erste-am.com. A summary of investor rights is available in German and English on the website www.erste-am.com/investor-rights as well as at the domicile of the management company.

The management company can decide to revoke the arrangements it has made for the distribution of unit certificates abroad, taking into account the regulatory requirements.

This document serves as additional information for our investors and is based on the knowledge of the staff responsible for preparing it at the time of preparation. Our analyses and conclusions are general in nature and do not take into account the individual needs of our investors in terms of earnings, taxation, and risk appetite. Past performance is not a reliable indicator of the future performance of a fund. Please note that investments in securities entail risks in addition to the opportunities presented here. The value of shares and their earnings can rise and fall. Changes in exchange rates can also have a positive or negative effect on the value of an investment. For this reason, you may receive less than your originally invested amount when you redeem your shares. Persons who are interested in purchasing shares in investment funds are advised to read the current fund prospectus(es) and the Information for Investors pursuant to § 21 AIFMG, especially the risk notices they contain, before making an investment decision. If the fund currency is a currency other than the investor's home currency, changes in the corresponding exchange rate may have a positive or negative impact on the value of his investment and the amount of the costs incurred in the fund - converted into his home currency.

Please consult the corresponding information in the fund prospectus and the Information for Investors pursuant to § 21 AIFMG for restrictions on the sale of fund shares to American citizens. Misprints and errors excepted.