Bellevue Digital Health (Lux)
Portfolio consisting of high-quality growth stocks showing double-digit revenue growth
Regulation and stringent quality requirements limit the technological risk
Demographic changes and an aging general population demand greater efficiency and cost-effectiveness
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Investment Focus
ISIN-No. LU1811047247
The fund invests globally at least two-thirds of the portfolio in companies whose business activities have a strong focus on the digitalization of the healthcare sector. A global network of experts spanning scientific and industrial fields support the Management Team in forming opinions. The selection of portfolio companies is bottom-up.
Indexed performance (as at: 27.01.2023)
NAV: USD 195.22 (26.01.2023)
Rolling performance (26.01.2023)
I-USD | Benchmark | |
26.01.2022 - 26.01.2023 | -1.55% | n.a. |
26.01.2021 - 26.01.2022 | -38.73% | n.a. |
24.01.2020 - 26.01.2021 | 80.60% | n.a. |
25.01.2019 - 24.01.2020 | 13.99% | n.a. |
Annualized performance (26.01.2023)
I-USD | Benchmark | |
1 year | -1.55% | n.a. |
3 years | 2.89% | n.a. |
Since Inception p.a. | 9.85% | n.a. |
Cumulative performance (26.01.2023)
I-USD | Benchmark | |
1M | 4.62% | n.a. |
YTD | 4.26% | n.a. |
1 year | -1.55% | n.a. |
3 years | 8.95% | n.a. |
Since Inception | 56.18% | n.a. |
Annual performance
I-USD | Benchmark | |
2022 | -27.67% | n.a. |
2021 | -10.10% | n.a. |
2020 | 68.37% | n.a. |
2019 | 18.13% | n.a. |
Facts & Key figures
Investment Focus
The fund’s aim is to achieve capital growth in the long term. The fund invests globally at least two-thirds of the portfolio in companies whose business activities have a strong focus on the digitalization of the healthcare sector. Show moreShow less
Investment suitability & Risk
Low risk
High risk
General Information
Investment Manager | Bellevue Asset Management AG |
Custodian | RBC Investor Services, Luxembourg |
Fund Administrator | RBC Investor Services, Luxembourg |
Auditor | PriceWaterhouseCoopers |
Launch date | 30.04.2018 |
Year end closing | 30. Jun |
NAV Calculation | Daily "Forward Pricing" |
Cut of time | 15:00 CET |
Management Fee | 0.90% |
Subscription Fee (max.) | 5.00% |
ISIN number | LU1811047247 |
Valor number | 41449386 |
Bloomberg | BBDIGIU LX |
WKN | A2JJA5 |
Total expense ratio (TER) | 2.14% (30.12.2022) |
Legal Information
Legal form | Luxembourg UCITS V SICAV |
SFDR category | Article 8 |
Redemption period | Daily |
Key data (30.12.2022, base currency USD)
Volatility | 34.20 |
Sharpe ratio | 0.23 |
No. of positions | 39 |
Portfolio
Top 10 positions
Market capitalization
Geographic breakdown
Opportunities & Risks
Opportunities
- Demographic changes and an aging general population demand greater efficiency and cost-effectiveness.
- New technologies conquer the healthcare sector.
- Portfolio consisting of high-quality growth stocks showing double-digit revenue growth.
- Regulation and stringent quality requirements limit the technological risk.
- Bellevue – Healthcare pioneer since 1993 and today one of the biggest independent investors in the sector in Europe.
Risks
- The fund invests in equities. Equities are subject to price fluctuations and so are also exposed to the risk of price losses.
- The fund invests in foreign currencies, which means a corresponding degree of currency risk against the reference currency.
- 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.
- Equities linked to technology and/or digitization can be subject to higher-than-average fluctuations in value.
- The fund may engage in derivatives transactions. The increased opportunities gained come with an increased risk of losses.
Review / Outlook
After advancing for a couple months, stocks consolidated in the final month of the year. Global stock markets (MSCI World Net -4.2%) and the US tech sector (Nasdaq 100 -9.0%) closed sharply lower in December. Digital health stocks and the Bellevue Digital Health Fund (-3.1%) were not completely shielded from the widespread selling pressure, but they still performed better than the overall market, a trend that can now be traced back over the past 6 months as the Digital Health Fund (+17.4%) clearly outperformed US tech stocks (Nasdaq 100 -4.5%) and global stocks (MSCI World Net -3.0%) during the second half of 2022. This can be traced on the one hand to the fund's consistent focus on fast-growing, commercially successful innovation leaders that are not reliant on external sources of capital, which paid off, and, on the other hand, to the favorable position that the healthcare sector and thus also digital health companies are in relative to other industries with a recession looming on the horizon, which is what the market is currently expecting.
However, the impact of macro factors, first and foremost the rapid rise in US interest rates, which led to a steep drop in the valuation multiples of growth companies, during the first half of the year proved to be too strong and good earnings results and positive fundamentals in the digital health space were unable to offset it over the entire year.
The Bellevue Digital Health Fund (-28.2%) thus closed 2022 with a clearly negative return, better than US tech stocks (Nasdaq 100 -32.4%) but lagging the world stock market (MSCI World Net -18.1%). The average performance of the companies in our digital health investment universe (equal weighted) stood at -36.9%, the median performance was -42.1%.
We are optimistic that the above-mentioned trend from the past 6 months will continue into 2023 and that company-specific business developments will play a greater role in the performance of individual stocks. The significant progress that digital health companies have achieved is expected to attract more attention again as the macro environment becomes less volatile. Investors will nevertheless keep a close eye on US interest rate developments. That said, interest rates are already significantly higher, and the valuations of digital health companies are at more attractive, lower levels than they were at the beginning of 2022.
Although the stocks of many companies experienced sharp corrections in 2022 (-50% and more), we will continue to focus on commercially successful companies rather than betting on the “dogs of 2022” or on companies whose potential business success could be years away. We are confident that in today’s challenging economic environment, the manifest market leaders will pull even further ahead of me-too rivals. There are a number of attractive companies whose shares corrected sharply in 2022 but that could make a quantum leap in their business development thanks to the launch of major new products and services. We also expect M&A activity to pick up significantly. Valuations of digital health companies are at attractive levels and potential buyers in the tech or medtech industry are sitting on piles of cash.
The J.P. Morgan Healthcare Conference, the premiere investor event for healthcare stocks, is scheduled for early January. Many companies will present preliminary results for the fourth quarter of 2022 and give an initial outlook for the coming fiscal year. Overall we believe the digital health sector is very well positioned for the coming investment year, both in relative and absolute terms. All performance data is in USD / B shares.
The fund's investment strategy is focused on innovative market leaders and solidly financed companies. More than 95% of the companies in the portfolio have no immediate financing needs. Companies in the highly regulated and non-cyclical healthcare market also benefit from the industry’s high entry barriers.
The portfolio contains fast-growing, disruptive companies that are applying digital technology to improve healthcare delivery and outcomes while making healthcare more cost-effective. In addition, the companies in the Digital Health Fund's portfolio are expected to generate high double-digit sales growth rates over the coming years and visibility is good.
The growing acceptance of digital solutions in the wake of the pandemic has pushed up the potential growth trajectory of the digital health investment case. We also expect M&A activity to pick up significantly. Equity capital investors have invested about USD 97 bn in 4400 privately held digital health firms since 2011, so we expect a steady stream of attractive IPOs in the coming years – another reason, and an important one, for investing in this sector.
Documents
Past performance is not a reliable indicator of future results and can be misleading. As the sub-fund 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. Show moreShow less