Die globalen Aktienmärkte legten im August weiter zu, da sich die Erwartung einer V-förmigen Wirtschaftserholung verfestigte und die Quartalsberichte vieler Firmen für das zweite Quartal auf der Oberseite überraschten. In dieser freundlichen Marktumgebung verzeichnete auch der Pictet Security P EUR (WKN A0LC44, ISIN LU0270904781) eine positive Kursentwicklung, wozu alle drei Untersegmente des Fonds ihren Teil beitrugen. Das aus Yves Kramer, Alexandre Mouthon und Rachele Beata bestehende Pictet Security Management Team analysiert für alle Investoren der FondsStrategie SJB Nachhaltig die jüngsten Marktentwicklungen und Portfolio-Veränderungen im Detail. Zudem thematisiert der aktuelle Marktbericht die FondsPerformance und gibt einen Ausblick auf die Aktienmärkte des Security-Sektors.
Market review
Global stocks surged in August as investors pushed aside worries about the second wave of the coronavirus and bet that monetary and fiscal stimulus would support a V-shaped economic recovery. The MSCI AC World Index rose 6.1% in USD as investors were also encouraged by the improving outlook for earnings; second quarter corporate earnings have surprised on the upside and net earnings per share (EPS) revisions have turned positive. US stocks rose 7.5% in the month to be the biggest outperforming market, marking the best August in at least 30 years. Japanese stocks fared especially well with gains of over 9%. Consumer discretionary stocks were the best performing sector after rising more than 12% in the month. However, not all stocks have joined in on the rally. Utilities fell 2% while energy, healthcare, and real estate sectors posted only modest gains. Regarding the security universe, IT Security Products, Security Services and Physical Security Products were all positive over the month.
Performance analysis
The strategy underperformed the MSCI AC World over the month, with all three segments contributing positively to the fund’s absolute performance. The performance of the Physical Security Products was mainly driven by stocks, which published very strong half-year results. Security services was up on the month, with business services and fintech being the main contributors. Within the IT Security Products pocket, cybersecurity names continue to perform strongly, and semiconductors came back strongly this month.
Portfolio activity – overweightings & underweightings
Over the month, our trading activity led to a slight increase in Physical Security Products, a decrease of the Security Services and a stable allocation in IT Security Products. In Physical Security Products, after a very strong set of earnings from our life sciences names, we have continued to take some money off the table. At the same time, we increased our bets in the industrial safety space as our companies came out with stronger 2Q earnings and stronger 2H outlook, even if remaining prudent in the current Covid environment. In IT Security we continued to increase exposure to specific companies while in the Security Services we have reduced the fintech segment. Over the month, we bought one new name and sold off one in the IT Security Products.
Market outlook
Given the persistent uncertainty surrounding the current state of the economy, we believe that securing the critical infrastructures of countries, protecting citizens’ integrity and ensuring the ability of businesses to meet their objectives are a top priorities. We therefore remain confident about the fund’s ability to outpace the global equity market on earnings and cash-flow growth over the next few years, as stricter regulation (such as PSD2, GDPR) is likely to remain a key driver for security going forward; and IT systems and cybersecurity remain a priority for governments and companies. We are therefore confident that the fund is an attractive investment opportunity to capture a long-term trend with strong fundamentals and good diversification properties.
Portfolio strategy
This year, governments and central banks have certainly delivered, pulling the global economy out of a pandemic-caused slump with record-breaking volumes of stimulus. However, it is too early to break out the champagne, coronavirus cases around the world are still rising and corporate earnings are in freefall. Key positive developments have been Europe’s newly agreed EUR 750 billion recovery fund. Encouragingly, 70 per cent of it is expected to be spent over the next two years. China remains ahead in terms of the extent of its recovery, which, along with a weaker dollar, should be supportive for emerging markets. In general, we think that the monetary and fiscal stimulus pledged across the globe should be enough to offset the uncertainty related to the pandemic. However, daily indicators, such as credit card use and traffic congestion, suggest that on a global level activity is improving slowly, potentially reflecting a fresh increase in Covid-19 cases. The markets have discounted so much good news that valuations are looking rather stretched. With such a backdrop, we continue to be focused on growth and quality names within the portfolio. The Security Services exposure is around 38%, still our largest segment. We will continue to be opportunistic by raising exposure to cyclical names when appropriate.
Pictet Security Management Team
Yves Kramer
Alexandre Mouthon
Rachele Beata
