Bellevue Entrepreneur Switzerland (CH)
Owner-operated or family-run companies think in generations, not in quarters
Solid balance sheets, high innovative strength and safety awareness have a positive effect on the share price
Companies impress with high ESG scores
Please find a more detailed description of share classes here.
The Fund invests in listed owner-managed companies in Switzerland where an entrepreneur or a founder family holds at least a 20% of a company’s voting rights, thereby exerting significant influence. The Management Team pursues a fundamental, bottom-up approach in identifying the most attractive founder-controlled companies while maintaining an investment portfolio diversified by sector and style (Value, GARP, Growth).
Indexed performance (as at: 23.09.2022)
NAV: CHF 167.91 (22.09.2022)
Rolling performance (22.09.2022)
|22.09.2021 - 22.09.2022||-27.48%||-14.03%|
|22.09.2020 - 22.09.2021||39.65%||19.49%|
|20.09.2019 - 22.09.2020||18.56%||5.54%|
|21.09.2018 - 20.09.2019||-6.15%||13.71%|
Annualized performance (22.09.2022)
|Since Inception p.a.||8.73%||7.84%|
Cumulative performance (22.09.2022)
Facts & Key figures
The Fund invests in listed owner-managed companies in Switzerland where an entrepreneur or a founder family holds at least a 20% of a company’s voting rights, thereby exerting significant control and influence. The typical qualities of these companies – a focused business model, fast decision-making processes, sustainable business policies and a strong corporate culture – go hand in hand with efficient innovation, high product quality and strong customer loyalty. The corresponding impact on the share price is demonstrably positive. The Fund’s Management Team offers a wealth of experience in this investment segment and has built up an extensive network with executives throughout the sector. It pursues a fundamental, bottom-up approach in identifying the most attractive founder-controlled companies with a small, mid as well as large market capitalization while maintaining an investment portfolio of 25 to 40 stocks diversified by sub-sector and style (Value, GARP, Growth).Show moreShow less
Investment suitability & Risk
|Investment Manager||Bellevue Asset Management AG, Küsnacht|
|Custodian||RBC Investor Services Bank, Zürich|
|Fund Administrator||PMG Investment Solutions AG, Zug|
|Year end closing||31. Dec|
|Subscription Fee (max.)||5.00%|
|Total expense ratio (TER)||1.58% (31.08.2022)|
|Legal form||Swiss Fund|
Key data (31.08.2022, base currency CHF)
|No. of positions||43|
Top 10 positions
Breakdown by sector
Opportunities & Risks
- Owner and family-run businesses think in generations, not in quarters.
- Focus, a sense of responsibility, strong identification with the company, and personal financial commitment have a positive impact on the share price.
- More conservatively financed, lower debt exposure and a higher risk capacity compared to non-family businesses.
- Multi-award-winning management team with a long and successful track record investing in owner-run firms.
- Entrepreneurs for entrepreneurs – the Bellevue Group is itself an owner-run company with the majority of shares held by employees.
- The fund invests in equities. Equities are subject to price fluctuations and so are also exposed to the risk of price losses.
- Shares in smaller businesses are generally traded in lower volumes and are subject to bigger price fluctuations than larger enterprises.
- The fund may invest a proportion of its assets in financial instruments that might under certain circumstances have a relatively low level of liquidity, which can in turn affect the fund’s liquidity.
- Succession planning poses an additional risk for owner-run companies.
- The fund may engage in derivatives transactions. The increased opportunities gained come with an increased risk of losses.
Review / Outlook
Swiss equities, as measured by the SPI, reverted the positive July trend and fell 3.1% in the month somewhat better than global markets. The bearishness was underpinned by the more hawkish statements by Fed Chair Powell in Jackson Hole, reaffirming the Fed’s firm inflation-fighting intentions even at the risk of over-tightening. In the EZ inflation rose to a record 9.1% in August with core inflation up to 4.2% versus 4% expected, signaling the likelihood a higher 75 bps hike for the upcoming ECB meeting. Swiss inflation data was mild by international standards, reaching 3.5%, at the higher end of expectations. Swiss PMIs also surprised positively, with Industry PMI only slightly weaker to the level of 56.4, while Service PMI rose further to reach 56.7. Record increases in gas and electricity prices risk dragging Europe into recession as signaled by the EUR/USD hitting a 20-year low, falling below parity. Oil was lower with WTI down 9.2%. On a more positive side, soft commodities weakened, reverting to levels seen before the outbreak of the Ukraine war. Sector performance presented a patchy picture, with utilities (+8.2%), financials (+0.4%) and communication services (-0.7%), holding up best while industrials (-7.5%), information technology (-4.8%) and materials (-4.6%) lagged the most.
Against this backdrop, the Fund fell 4.7% (CHF / A shares), a 171 bps underperformance versus its benchmark.
Main detractors in the month were Zur Rose (-32.5%), Sonova (-24.1%) and Straumann(-15.7%). Zur Rose fell sharply on new concerns around the introduction of the e-prescription in Germany. Local media reported that Schleswig-Holstein, scheduled to start the program on September 1, was pulling out due to concerns about patient’s data protection. With some delay, the German government reacted, signaling a speedy roll-out and confirming the safe handling of e-scripts via pharmacy apps. Finally, on September 1, Zur Rose announced the issuance of a convertible and a capital increase which was fully subscribed, addressing the potential refinancing issue of 2023. Sonova and Straumann both corrected strongly on the publication of their Q2 results. Sonova cut FY guidance mainly driven by a weaker US market and a negative impact from the geographic and channel mix on margins, exacerbated by higher freight and component costs. Straumann left FY guidance unchanged, but this clearly disappointed the market. Also, comments about a softening of the US clear aligner demand were taken as a potential leading indicator for Europe. Having been considered so far as relative safe heavens, the names suffered all the more by a de-rating of their rich valuation multiples.
Top performers in the month were U-Blox (+22.2%), VP Bank (+8.4%) and Aryzta Group (+5.8%). U-Blox, the specialist of IoT chips and modules, continued to enjoy a strong share price momentum thanks to a strong H1 beat and another guidance hike. Market demand is further accelerating across all regions and application sectors, and the new products have found very good response, boding well for further design wins. VP Bank reported figures pretty much in line with expectations, reassuring the market. This helped the stock rebound in August and recoup the losses from previous months. Aryzta benefited from a broker comment regarding encouraging channel checks pointing towards positive business developments in the second half of this year.
“Everything is driven by macro, but no one really knows what the macro is going to be”. Interest rates are fundamental to the different market style returns. Low multiple stocks (value) gain over high multiple stocks (growth) when interest rate rise. In this cycle however, timing and magnitude of the interest rate moves are very hard to predict and the relative performance of value vs growth follows the near erratic ups and downs of rates from month to month. Growth stocks multiples have come down significantly since 2021 but remain well above historical average. Value stocks on the other hand might be cheap but valuation alone is not enough, especially if it comes with weak stability in the potential scenario of a future earnings recession. At present we feel the discussion of value vs growth is less relevant for alpha generation and we want to focus bottom-up on cashflow resilience in the face of overall growth and inflation headwinds. We look for companies with high FCF yields and good cash conversion in attractive market niches.
Past performance is not a reliable indicator of future results and can be misleading. As the subfund is denominated in a currency that may differ than an investor’s base currency, changes in the rate of exchange may have an adverse effect on prices and incomes. Performance is shown net of fees and expenses for the relevant share class over the reference period. All performance figures reflect the reinvestment of dividends and do not take into account the commissions and costs incurred on the issue and redemption of shares, if any. Individual costs are not taken into account and would have a negative impact on the performance. With an investment amount of EUR 1,000 over an investment period of five years, the investment result in the first year would be reduced by the front-end load of up to EUR 50 (5%) as well as by additional individual custody charges. In subsequent years, the investment result would also be reduced by the individual custody account costs incurred. The reference benchmark of this class is used for performance comparison purposes only (dividend reinvested). No benchmark is directly identical to a subfund, thus the performance of a benchmark is not a reliable indicator of future performance of the subfund it is compared to. There can be no assurance that a return will be achieved or that a substantial loss of capital will not be incurred.Show moreShow less