Bellevue Emerging Markets Healthcare (Lux)
Increased demand for healthcare products/ DL due to rising share of the middle class
Above-average increase in healthcare spending in the Emerging Markets
Complementary building block for a diversified Emerging Markets portfolio
Explained in 90 seconds
Please find a more detailed description of share classes here.
This fund invests in the entire emerging-market healthcare universe. Its investment universe consists of generics producers, pharma and biotech companies, medical technology and services firms. Experienced sector specialists focus on profitable companies that have a well-established product portfolio. Investments are made based on fundamental research analysis.
Indexed performance (as at: 23.09.2022)
NAV: USD 125.72 (22.09.2022)
Rolling performance (22.09.2022)
|17.09.2021 - 22.09.2022||-42.62%||-44.11%|
|22.09.2020 - 17.09.2021||6.71%||14.52%|
|20.09.2019 - 22.09.2020||46.59%||41.29%|
|21.09.2018 - 20.09.2019||-7.40%||-21.33%|
Annualized performance (22.09.2022)
|Since Inception p.a.||0.11%||-3.10%|
Cumulative performance (22.09.2022)
Facts & Key figures
This fund invests in the entire emerging-market healthcare universe. Its investment universe consists of generics producers, pharma and biotech companies, medical technology and services firms. Experienced sector specialists focus on profitable companies that have a well-established product portfolio. Investments are made based on fundamental research analysis. Stock selection is exclusively bottom-up, independent of benchmark weightings.Show moreShow less
Investment suitability & Risk
|Investment Manager||Bellevue Asset Management AG|
|Custodian||RBC Investor Services, Luxembourg|
|Fund Administrator||RBC Investor Services, Luxembourg|
|Year end closing||30. Jun|
|NAV Calculation||Daily "Forward Pricing"|
|Cut of time||09:00 CET|
|Subscription Fee (max.)||5.00%|
|Performance Fee||10.00% (with High Water Mark)|
|Total expense ratio (TER)||1.51% (31.08.2022)|
|Legal form||SICAV Luxembourg jurisdiction|
|SFDR category||Article 8|
Key data (31.08.2022, base currency USD)
|No. of positions||32|
Opportunities & Risks
- Access to defensive growth – emerging countries are facing aging populations and changing lifestyles.
- Development of healthcare infrastructure combined with a growing middle class is an additional growth driver.
- High growth potential of emerging markets.
- Attractive valuations compared with the projected medium to long-term growth.
- BB Adamant Team – top-performing pioneer in the management of healthcare portfolios in emerging markets.
- Equities are subject to price fluctuations and so are also exposed to the risk of price losses.
- Investing in emerging markets entails the additional risk of political and social instability.
- Investments in foreign currencies are subject to currency risks.
- There is a higher counterparty risk due to regulatory changes, volume caps or operational restrictions when investing in Chinese A-equities
- The fund may invest in financial instruments that might have a rather low level of liquidity, which can in turn affect the fund’s liquidity.
Review / Outlook
Stock markets stayed in a cheery mood and tacked on some more gains until the middle of August. Positive earnings announcements, a consumer price inflation reading that came in below market expectations and, last but not least, hopes that central banks would put an early end to their monetary tightening were factors that pushed stocks higher. However, Jerome Powell's speech at the annual gathering of central bankers in Jackson Hole poured a big bucket of cold water on the positive sentiment. Powell stated quite clearly that the Fed would maintain a more restrictive monetary policy course for some time to come in order to bring inflation down to 2%. He also pointed out that the past experience served as a strong warning not to revert to a loose policy stance too early. His speech caused bond yields around the world to spike and put stock markets under pressure. The MSCI World Index returned a negative 4% in USD terms for the month and has fallen 17.5% since the beginning of the year. Meanwhile the MSCI Emerging Markets Index gained almost 0.5%, while healthcare stocks in the region ended August 2.7% lower.
Chinese digital healthcare services provider JD Health reported a convincing set of half-year results. Sales for the period increased nearly 50% year-on-year, beating market expectations. Management confirmed its forecast for the second half of the year, which was somewhat disappointing for investors. The high sales base in the previous year and uncertainties regarding consumer sentiment were the reasons given for not raising full-year guidance. We believe the rather cautious outlook leaves some room for positive surprises and have therefore slightly increased our position in JD Health.
Brazilian health insurer Hapvida resumed its organic growth during the second quarter of 2022. In net terms, it increased the number of its insured customers by 139000. This was a positive surprise after a long period of slack business during the pandemic. Hapvida's shares shot up more than 17% on the day of the announcement. Looking ahead, a crucial factor will be whether costs per customer can be brought under control again. The pandemic led to a significant increase in consultation volumes and had a corresponding negative impact on the latest quarterly results. We are confident that Hapvida will be able to get its costs under better control than its competitors going forward thanks to its vertically fully integrated model.
Thai hospital chain Bangkok Dusit Medical Services reported excellent quarterly results. Particularly pleasing was the news that company grew its core business (excluding COVID-19-related sales) by 28% year-on-year, bringing it close to pre-pandemic levels. Dusit management expects the recovery in business to continue during the second half of the year, driven by medical tourism in the wake of the economic reopening.
Positions in Frontage and Fleury were added to the portfolio as next positions last month and existing positions in JD Health, Hapvida, Rede D’Or and Sun Pharmaceuticals were increased. Shanghai Fosun, Pharmaron, Hengrui and Ovctek were removed from the portfolio and shareholdings of Beigene and Wuxi Biologics were trimmed.
The fastest growing countries in the world can be found in emerging markets and they contain more than half of the world's population. Asian emerging markets are also forecast to account for more than 50% of global GDP by 2050. It is known that the economic growth model of countries shifts from manufacturing to the services sector as household incomes rise. A growing middle class fuels demand for modern medicine. Healthcare ranks increasingly high on their wish list. Billions are being invested in infrastructure, technology and research to modernize the healthcare systems in emerging market countries. This is giving a greater swath of the population access to better healthcare. Meanwhile rapid population aging is also stoking demand for healthcare. In 30 years’ time there will be 400 to 500 million people over 60 in China alone, and they will have a growing need for modern health services and medicines.
Outside Asia, Brazil’s rapidly expanding private-sector healthcare market offers a range of interesting investment opportunities. The quality and long waiting times of the country’s public health system are no longer acceptable to many higher-income Brazilian households and they are increasingly embracing these new services offered by private-sector healthcare providers. Hospital chains embedded in a fully-integrated ecosystem are but one example of the beneficiaries of this structural change. The fund serves as a defensive vehicle for capturing the above-average growth potential emerging markets offer. It invests in the entire healthcare system value chain, from hospital chains, drug developers and device manufacturers to medical research specialists and digital health companies.
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. 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 sub-fund, thus the performance of a benchmark is not a reliable indicator of future performance of the sub-fund 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. All figures in base currency in %, calculated by the total return / BVI method.Show moreShow less