RobecoSAM Circular Economy Equities IE USD

Natalie Falkman is Portfolio Manager of the RobecoSAM Circular Economy Equities strategy. Before joining Robeco in 2022, she was a portfolio manager for Kapitalinvest, a global equity, 5-star rated by Morningstar, fund at Swedbank Robur in Stockholm. Prior to that, she worked as the Head of Emerging Markets research at Carnegie (formerly HQ Bank), covering Eastern Europe and Africa, before shifting her focus to Nordic stocks. She started her career in 2002 as an equity research analyst at Deutsche Bank in Moscow covering utility and shipping sectors. Natalie holds a Master in Finance from Stockholm School of Economics.

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 0.01% 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.

Investors who are not subject to (exempt from) Dutch corporate-income tax (e.g. pension funds) are not taxed on the achieved result. Investors who are subject to Dutch corporate-income tax can be taxed for the result achieved on their investment in the fund. Dutch bodies that are subject to corporate-income tax are obligated to declare interest and dividend income, as well as capital gains in their tax return. Investors residing outside the Netherlands are subject to their respective national tax regime applying to foreign investment funds. We advise individual 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 finance solutions that support the transition from traditional production and consumption patterns toward a circular economy. Circular economy and sustainability considerations are incorporated in the investment process by the means of a target universe definition, exclusions, ESG integration, and voting. The fund only invests in companies that have a significant thematic fit as per Robeco's thematic universe methodology. Through screening on both Robeco's internally developed SDG Framework and Robeco’s exclusion policy, the fund does not invest in issuers that have a negative impact on the SDGs, are in breach of international norms or where products have been deemed controversial. Financially material ESG factors are integrated in the bottom-up fundamental investment analysis to assess existing and potential ESG risks and opportunities. In addition, 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 first two weeks of the Q1 earnings season revealed an astonishing breadth of earnings beats. With that said, the big tech names provided the main fuel for the continued SPX rally. The often conflicting macro data points and companies' market comments leave room for both bears and bulls to stay entrenched in the respective views. However, the continued market resilience has been supported by investors' overall cautious views and positioning. This is exemplified by equity strategists' average end-of-year target price for the S&P 500 being below current levels. Currently, the Bloomberg collected consensus average target price for year-end for the S&P 500 is 4,025. The S&P 500 closed at 4,169 on the last day of April. In this continued uncertain environment, we prefer exposure to two main fundamental themes. First, we favor exposure to companies that are market share takers in their respective segments. The second area we favor are the segments that can retain growth momentum, also in uncertain and weaker markets. These areas are often linked to sustainability themes.

The visibility so far this year is better than in 2022, when macro clearly dominated micro. However, the main bull-bear debate between a soft and a hard landing of the economy remains unresolved. April produced both positive and negative data points, without the scale being tipped. In the current environment we remain patient, as high volatility occasionally presents attractive opportunities. In addition, we focus on two fundamental areas. First, we look for exposure to companies that are market share gainers in their respective segments. Secondly, we seek exposure to areas that are able to sustain growth momentum, also in weaker economic conditions. These areas are often linked to sustainability themes and have support from regulations, government-backed investments or both. These areas also often provide better visibility into future growth opportunities and help exposed companies make investment decisions that will ultimately result in earnings growth and reduce earnings volatility.