by Andreas Hohenadl, Euro on Sunday
un order to achieve above-average performance over the long term, the mixed fund Bantleon Changing World relies on so-called future themes. Bonds and a dash of precious metals, especially gold, should ensure stability in the portfolio. In an interview, fund manager Johannes Maier explains which trends he is investing in and how he is currently setting up the portfolio.
uro on Sunday: Mr. Maier, with the fund you want to offer a basic investment for a changing world. What is your strategy?
Johannes Maier: We focus on companies benefiting from the most stable and substantial growth trends: digital infrastructure, renewable energy, smart cities and mobility, digital disruptors. Together with the flexible control of the equity and bond quota, the weighting of the individual sub-segments and the precious metal quota, this is the basis for a solid fund. The allocation is based on the expected development of the economy and interest rates. We use the forecasts of the Bantleon economic analysts, which have proven to be very accurate in the past. In addition, the fund implements a sustainability-oriented investment approach in all asset classes.
The world has indeed changed radically since Russia invaded Ukraine. How did you align the fund to the new situation?
The leading economic indicators for 2023 looked bleak even before the geopolitical tensions. This is why we came into conflict with a neutral equity ratio and an overweight in defensive equity segments. Since the outbreak of the war, we have positioned ourselves even more defensively. That means higher gold and cash ratios, as well as a focus on companies whose demand is less cyclical. However, we now see new opportunities in some segments.
Where for example?
As a consequence of the Ukraine war, the cards are being reshuffled when it comes to the energy mix, and the expansion of renewable energies in Europe has received new impetus with energy sovereignty. We also see selectively attractive entry levels in the technology segment again after the sustained rise in interest rates left its mark on valuations.
Since you brought up the subject of interest rates, high inflation is also putting increasing pressure on the markets. What are you doing to counteract this?
We already expected in 2021 that inflation would not be a temporary phenomenon. We were therefore able to benefit from the price explosion again this year through inflation-indexed bonds, the coupons of which are linked to the inflation rate. We also favor companies with sufficient pricing power. High inflation, for example, has not weighed on infrastructure companies in the past because their earnings are usually linked to the inflation rate.
Bonds are an important element of risk diversification in your portfolio. Where can you find attractive securities in times of rising interest rates?
Whether the yield peak has already been reached remains the crucial question for bonds. Although we assume that further rises in yields can be expected over the next five years, there is much to suggest that the economic environment will noticeably deteriorate in the coming year. While the focus this year is on shortening the duration, it should be possible to bring in a rich harvest again in 2023 by lengthening the term. Then bonds are again a good diversifier and deliver a high added value in mixed portfolios. When selecting nominal bonds, we currently attach importance to the fact that the current interest rate already offers protection against further increases in interest rates. At present, this applies in particular to covered bonds and corporate bonds. In the medium term, current interest should more than compensate for the losses from the rise in interest rates.
They also invest in gold, the production of which is controversial. How does that fit into your sustainability approach?
We invest in gold produced based on the Responsible Gold Mining Principles. The certification aims to minimize ESG risks in the value chain and ensure that the precious metal is mined under high ESG standards and is not used to launder money or to finance terrorism or wars.
Bantleon Changing World:The multi-asset fund launched in August 2018 invests a maximum of 65 percent in equities, at least 25 percent in solid bonds and five to ten percent in precious metals.
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Image sources: BANTLEON
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