Income Generation / Total Return

7% p.a., net of fees

Daily

Luxembourg-regulated AIF

30 April 2020

Beauclerc Limited

Manager comment

The equity correction in September carried over into early October, before EM and DM equity indices bounced back to end up fully recouping their late summer losses. At the end of October, equity markets set new record highs on the back of better company earnings and still buoyant GDP growth momentum. The global economic outlook improved in October, as it became evident that some of the temporary drags on US & Asian economies seen in the summer, would fade away in Q4 2021. The declining impact of the delta variant on the US activity, the Chinese new supportive policy initiatives (easing on property sector crackdown) as well as the rising mobility in Asia, did pave the way for a stronger GDP growth this winter. As a result, the global demand should remain above its long-term trend into early 2022 but inflationary pressures driven by supply chains issues might only recede from Q2 2022 onwards. Meanwhile, only commodity markets seem to factor in both persisting output gap and inflation, while equity markets seem to be more focus on the rising earnings forecasts. The Q3 earnings season is almost completed and the positive surprise rate has been strong, mostly due to undemanding expectations. The economic mid-cycle transition which should have led to slower growth in corporate earnings looks to be postponed to H1 2022, given the current reacceleration in global activity. In addition, the rising inflation outlook has not triggered a major hawkish turn in Central Banks’ guidance, giving more headroom for growth stocks valuations to stay elevated for longer. However, above-trend inflation forecasts and surging commodity prices created concerns amongst institutional investors, either as a threat to consumer confidence and spending, or as a risk of inevitable tightening in global monetary conditions. Equity markets rebound was mostly driven by retail investors in October and further upside potential could only be unleashed by a favourable inflation news-flow.
The Fund achieved a strong performance in October, more than offsetting the September negative return. Secondary market valuations of volatility-income notes surged on the back of declining equity volatility as the equity rally was progressing. In addition, the portfolio running yield was raised to 8.5% early October, when the portfolio was fully reinvested at the bottom of the equity correction early October.

YTD

  • Cumulated Performance
  • Share class A

As of 02/11/2021

3 months

  • Cumulated Performance
  • Share class A

As of 02/11/2021

1 year

  • Cumulated Performance
  • Share class A

As of 02/11/2021

3 years

  • Cumulated Performance
  • Share class A

As of 02/11/2021

All

  • Cumulated Performance
  • Share class A

As of 02/11/2021