Commentaries

6 December 2019

Emmanuel Hauptmann

RAM Active Investments  RAM (Lux) Systematic Funds - North American Equities Maxime Botti Partner & Senior Systematic Equity Fund Manage

The RAM (Lux) Systematic Funds - North American Equities Fund ended the period up 4.11%* (PI USD class - net of fees), outperforming the MSCI North America TRN$’s return of 3.63%. Markets were again at the mercy of the sentiment surrounding the latest Sino-U.S. trade deal. Investors remaining hungry for evidence of progress on the finalisation of a so-called “phase one trade deal”, with markets largely in a holding pattern prior to any confirmation. Progress on the first phase of this phase one deal has been inching forward via phone calls and meetings, with President Trump saying the two countries are in the “final throes of a very important deal” and that the talks are going “very well.” This was seemingly enough for the market to react in a positive way, with markets largely buoyant by this news. The current narrative suggests that everything is rosy in domestic equity markets, with the Federal Reserve’s decision to cut interest rates three times helping to avert a nascent recession. Right on cue, the S&P 500 index hit a new all-time high, seemingly confirming this rosy narrative, posting its highest monthly return since June. Our Fund’s outperformance was generated across both Canada and U.S. picks. From a sector perspective, cyclical sectors such as Consumer Discretionary and Real Estate picks were the primary driver of outperformance. Within the former, General Merchandise Stores and Restaurants drove gains, while within the latter, our significant underweighting to Specialized REITs helped.

*Sources: RAM Active Investments