Commentaries

13 January 2020

Thomas de Saint-Seine

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 2.33%* (PI USD class - net of fees), marginally underperforming the MSCI North America TRN$’s return of 2.87%. Market optimism continues to revolve around the ongoing stimulative central bank fiscal policies, the de-escalation of trade tensions between the U.S. and China and a resilient domestic economy. While global manufacturing data remains weak, consumer confidence continues to prove robust and subsequently spending remains high. President Trump’s formal impeachment was passed by the House of Representatives, an event already discounted by the US equity market. Investor sentiment continued to improve on a phase one trade deal between the U.S. and China, enabling the S&P500 to find its 28th record high of 2019 (and strongest annual gain since 2013). Reports that the two countries reached a deal to avoid new tariffs in exchange for purchases of American agricultural products sent markets higher. From a factor perspective, Value underperformed at the expense of Growth stocks. Naturally, higher beta and thus higher volatile stocks profited amid a strong risk-on period, with Financials and Consumer Discretionary names primarily responsible for our relative underperformance. Elsewhere, our allocation to Communication Services stocks (interactive media and movies & entertainment) helped to assuage portfolio losses.  

*Sources: RAM Active Investments