After a difficult year of 2022 on the markets, many asset classes saw rebounding performances in 2023. While the central banks' turnaround on interest rates ensured a “return to normality” on the bond market, the focus on the equity market was primarily on technology companies. In the Funds exclusive series, the fund managers of selected funds look back on developments of the previous year and give their assessment of what the markets could expect in 2024.

"ERSTE FUTURE INVEST benefited in particular from investments in the technology megatrend in the semiconductor and software sectors."

Bernhard Selinger, fund manager ERSTE FUTURE INVEST

Fund & Performance

ERSTE FUTURE INVEST is an actively managed, global equity fund investing in megatrends (promising future trends). Equities associated with one or more of the following trends are preferred in the selection process: health and health provision, lifestyle, technology and innovation, environment and clean energy, and emerging markets.

Note: Past performance is not a reliable indicator of future performance. Due to the very short term, this presentation of the performance is not very meaningful.

Performance since start of the fund (10.10.2019). The performance is calculated in accordance with the OeKB method. The management fee as well as any performance-related remuneration is already included. The issue premium which might be applicable on purchase and as well as any individual transaction specific costs or ongoing costs that reduce earnings (e.g. account- and deposit fees) have not been taken into account in this presentation.

Commentary by fund manager Bernhard Selinger

What sort of conclusion do you draw for ERSTE FUTURE INVEST from 2023?

The global equity markets have performed very favourably in 2023. The main drivers were declines in inflation rates in Europe and the USA and consequently the hope of a foreseeable end to the current cycle of interest rate hikes, as well as technological advances in artificial intelligence.

ERSTE FUTURE INVEST benefited in particular from investments in the technology megatrend in the semiconductor and software sectors(Note: Please note, that an investment in securities entails risks in addition to the opportunities described). Recently, in the course of profit-taking, we reduced the position in NVIDIA and sold the position in Foxconn Industrial Internet entirely (Note: The companies listed here have been selected as examples and do not constitute an investment recommendation).

 

What do you expect for 2024 in terms of themes in your funds?

  • Megatrend healthcare

Diseases resulting from an unhealthy diet and lack of exercise are currently on the rise, particularly in emerging markets. Among other things, we invest in Novo Nordisk, a Danish pharmaceutical company that is a global leader in diabetes care.

  • Megatrend technology

The widespread use of robotics and artificial intelligence across all industries (e.g. IoT – “Internet of Things”) requires ever smaller chips with higher computing power while minimising energy consumption. The Taiwanese chip manufacturer TSMC is the world's technology leader in the production of computer chips and is represented in ERSTE FUTURE INVEST. The company benefits from growth in the semiconductor industry (demand for chips) as well as from the massive increase in complexity in the manufacturing process.

  • Megatrend environment

The EU Taxonomy, as an action plan to channel capital into ecological & sustainable activities, is decidedly promoting the transition to a circular economy. Kurita Water, a Japanese manufacturer of systems and chemicals for water treatment, is worth mentioning from the fund. The company's products reduce water consumption in the production process, for example in the steel industry and in pulp and paper production.

Note: Please note that investments in sustainable investment funds involve risks as well as opportunities.

  • Megatrend lifestyle

Global e-commerce spending has normalised again after the Covid boom and the subsequent slump in the wake of the reopening of local retail and is experiencing double-digit annual growth rates. Mastercard, the second-largest global payment service provider for credit & debit cards, cashless payments, and cash withdrawals at ATMs worldwide, also benefits from this fact.

  • Megatrend economies of change

China has been somewhat disappointing so far. We would have expected greater positive impetus from the reopening of the Chinese economy and additional stimulus measures. At 6%, we have deliberately kept China’s share in terms of assets under management low in the year to date, and we are also focussing on companies that benefit from the plan to reduce social inequality (“Common Prosperity”), e.g. from the healthcare sector. In the portfolio, for example, we are invested in Aier Eye Hospitals, the leading operator of ophthalmology facilities based in China.

Note: The companies listed here have been selected as examples and do not constitute an investment recommendation. In the context of active management, the portfolio positions mentioned may change at any time. There is no guarantee that securities will be permanently included in the portfolio. Promising companies may not be investable for sustainability reasons. It is not yet possible to predict which companies will benefit most from these trends in the long term.

ERSTE FUTURE INVEST

Disclaimer

This document is an advertisement. Please refer to the prospectus of the UCITS or to the Information for Investors pursuant to Art 21 AIFMG of the alternative investment fund and the Key Information Document before making any final investment decisions. Unless indicated otherwise, source: Erste Asset Management GmbH. Our languages of communication are German and English.

The prospectus for UCITS (including any amendments) is published in accordance with the provisions of the InvFG 2011 in the currently amended version. Information for Investors pursuant to Art  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 Art  21 AIFMG, and the Key Information Document can be viewed in their latest versions at the website 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 Information Document is available, and any additional locations where the documents can be obtained can be viewed on the website 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.

Detailed information on the risks potentially associated with the investment can be found in the fund prospectus or Information for investors pursuant to Art 21 AIFMG of the respective fund. 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.

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.