Commentaries

30 April 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 finished up 2.47%* (PI USD class - net of fees) over the month, underperforming the MSCI North America TRN$ which was up 3.93%. April saw a continuation of the strong start of the year, with equities reaching new highs in the U.S. This seemingly longstanding growth cycle, fuelled in part by Central Banks’ dovish tone, a lack of volatility and above-expectation earnings season, all created an idea performance backdrop for risky assets. On a style basis, both Value and Momentum underperformance their Low-Vol and Growth counterparts. Cyclicals outperformed Defensive sectors, while market cap was less a factor as the large, mid and small caps all performed broadly in line. U.S. benchmarks returned fresh all-time highs, with the market led by higher-beta sectors such as Financials, IT and Communication Services, while Health Care and Energy where the relative laggards. April witnessed the rebound of these previously crushed sectors in March, and our Health Care selections fared poorly as a result. Our stock selection to and overweighting to BioTech was the primary driver of our relative underperformance. Elsewhere, the Technology sector continues to be the key driver for U.S. equities in 2019, and April proved no exception. Our selection of two semiconductor names, whose earnings fell short of expectations, weighed heavily on returns. On a positive note, our underweighting to the Real Estate sector was a significant positive contributor.

*Sources : RAM Active Investments