RobecoSAM Net Zero 2050 Climate Equities D EUR

Chris Berkouwer is Co-Lead Portfolio Manager and member of the Global Equity team. He is responsible for fundamental global equities with a focus on companies in the energy, materials and industrials sectors, climate and portfolio construction. He joined Robeco in 2010. Prior to that, he worked as an analyst for the The Hague Centre for Strategic Studies. He conducted country, industry and company research for various equity teams prior to joining the Global Equity team. He a holds Master's in Business Administration and International Public Management from the Erasmus University Rotterdam. Yanxin Liu is Portfolio Manager and member of the Global Equity team. She is responsible for fundamental global equities with a focus on all sectors and on portfolio construction. Yanxin spent 11 years with our Emerging Markets Equity team, prior to joining the Global Equity team in 2022. Within the Emerging Markets team her focus was on all sectors in Greater China. Prior to that, Yanxin worked for DSM Pension Services in the Netherlands as an analyst focusing on US large-cap equities. Yanxin has a Master’s in Finance from the Erasmus University Rotterdam and a Bachelor’s in Financial Accounting from Nankai University in Tianjin, China. She became a CFA® charterholder in 2015 and is a native Mandarin speaker.

The fund is established in Luxembourg and is subject to the Luxembourg tax laws and regulations. The fund is not liable to pay any corporation, income, dividend or capital gains tax in Luxembourg. The fund is subject to an annual subscription tax ('tax d'abonnement') in Luxembourg, which amounts to 0.05% of the net asset value of the fund. This tax is included in the net asset value of the fund. The fund can in principle use the Luxembourg treaty network to partially recover any withholding tax on its income.

The fiscal consequences of investing in this fund depend on the investor's personal situation. For private investors in the Netherlands real interest and dividend income or capital gains received on their investments are not relevant for tax purposes. Each year investors pay income tax on the value of their net assets as at 1 January if and inasmuch as such net assets exceed the investor’s tax-free allowance. Any amount invested in the fund forms part of the investor's net assets. Private investors who are resident outside the Netherlands will not be taxed in the Netherlands on their investments in the fund. However, such investors may be taxed in their country of residence on any income from an investment in this fund based on the applicable national fiscal laws. Other fiscal rules apply to legal entities or professional investors. We advise investors to consult their financial or tax adviser about the tax consequences of an investment in this fund in their specific circumstances before deciding to invest in the fund.

The fund’s sustainable investment objective is to contribute to keeping global temperature rise well-below 2°C by reducing the carbon footprint of the fund. Climate change and sustainability considerations are incorporated in the investment process via exclusions, ESG integration, as well as voting. Firstly, the fund does not invest in stock issuers that are in breach of international norms or where activities have been deemed detrimental to society following Robeco's exclusion policy. This includes activity-based exclusions of Article 12 of the EU regulation on Climate Transition Benchmarks, EU Paris-aligned Benchmarks and sustainability-related disclosures for benchmarks as applicable. Secondly, the fund focuses on investing in companies that have set Net Zero goals by 2050 and examines other financially material ESG factors in the portfolio construction. Thirdly, by restricting the GHG emissions, the carbon footprint of the fund is made lower than that of the Climate transition benchmark to ensure alignment with the desired decarbonization trajectory of 7% year on year. Further, where a stock issuer is flagged for breaching international standards in the ongoing monitoring, the issuer will become subject to exclusion. Lastly, the fund makes use of shareholder rights and applies proxy voting in accordance with Robeco's proxy voting policy.The following sections display the ESG-metrics for this fund along with short descriptions. For more information please visit the sustainability-related disclosures.The index used for all sustainability visuals is based on MSCI World Climate Change Index (Net Return, EUR).

Based on transaction prices, the fund's return was -5.92%. October was a challenging month from both an absolute return (-5.9%) and relative perspective (-2.4%). Sector-wise, materials and utilities added the most to performance, whereas the technology sector caused the most headaches by far, followed by the consumer sectors. At the stock level, data analytics company RELX continued its ascent after its publishing arm signed a deal with a German academics consortium, which was certainly positive for sentiment on the stock, and will most likely also draw a line under investors' concerns regarding the profit model in this division. The largest performance detractor in October was SolarEdge, hitting its self-destruct button after flagging multiple unexpected headwinds until year-end, but also well into next year. With management still signaling strong order trends a month earlier, credibility definitely got a big hit with this large profit warning and bearish outlook commentary. Another disappointing holding was Lattice Semiconductor, maker of low-power logic devices, which plummeted following weak results on the back of order weakness across most of its consumer and industrial end-markets.

Against a volatile macro background, only few business models remain relatively unscathed. Even with the fastest monetary tightening by the Fed in forty years, labor and inflation data remains stubbornly sticky. As argued before, the transition to net zero is inherently inflationary as well. In combination with again rising energy prices as a result of escalating geopolitical flashpoints, the higher-for-longer rate mantra makes more sense than an imminent easing policy cycle kicking in. Consequently, market leadership will continue to be narrow, with familiar quality hiding places becoming overcrowded. And although positioning still argues for such caution and a quality tilt, the upside we do see is that in market routs like these, interesting opportunities do arise. At this stage we do not expect one neat clearing event for our universe, but we do see proof points that we are past peak fears, and hence ready ourselves to jump on glimmers of light in an overcast space. With our comprehensive approach to climate investing, we think we have the right strategy to capitalize on such opportunities.