EI Sturdza is a multi-boutique provider of investment funds offering equity strategies for China, Japan, developed Europe, emerging Europe and the US to high net worth individuals, institutions and wholesale investors. The
funds/strategies are marketed across Europe, Middle East and Asia. The business bears the name of its founder, Eric Sturdza, and is part of the Swiss private banking group.
Eric Vanraes, Fixed Income Portfolio Manager at EI Sturdza Investment Funds
1. Why you should still stay invested in bonds
Because bonds are a natural hedge of other asset classes such as equities but it means that you MUST favour high-quality bonds only, with good liquidity and without high correlation to equities in order to deliver positive performance when stock markets are in negative territory.
2. What are the asset classes that should be favoured?
In EUR, we favour APP (Asset Purchase Program) bonds (Govies + PSPP + CSPP), i.e. bonds bought by the ECB (EUR 80 billion/month) and in USD, we stay overweight long US Treasuries (both 30y nominal bonds and TIPS which are inflation-linked). In USD, we also favour high quality emerging bonds (but high quality only). We avoid any kind of bonds which eventually behave like equities in bear markets (high yield, deeply subordinated bank debt).
"European equity investors should not rely on Mario Draghi’s promised economic recovery" - Willem Vinke, portfolio manager
· Who will benefit from QE, falling yields and a weaker euro?
· QE is proving to be a tailwind for European equities - the market may re-rate EU stocks to new highs in 2015
· With an eye on valuations, sustainable business models are paramount
In this context, Willem will describe how his approach to fundamental research, quality and cash flow, process for valuations and compounding help investors navigate a choppy course for European equities.
Willem Vinke and the EI Sturdza Strategic Europe Value Fund – focusing on quality and valuations
· 95.4% since launch in October 2010
· High quality, cash-generating stock picking approach
· Morningstar OBSR Bronze Rating and 5-Star Rating
The presentation will cover:
- Europe: between very good news (QE) and bad news (Greece)
- Europe: a weak euro + weak oil prices + very low interest rates + ECB QE = good surprise on growth before year end?
- US: the Fed behaviour; Fed funds rate hike and USD strength
- US: good macro-economic data vs deflation fears
- US: international flows + BoJ QE and ECB QE + fight to quality = flattening of the US Treasury yield curve and 10- 30 yr rally despite macro and Fed