Robeco Emerging Markets Equities J USD

Wim-Hein Pals is Head of the Robeco Emerging Markets Equity team and Lead Portfolio Manager of the Global Emerging Markets Core strategy. Previously, he was Portfolio Manager Emerging European and African equities and Portfolio Manager Emerging Asian equities. Wim-Hein started his career in the investment industry at Robeco in 1990. He holds a Master's in Industrial Engineering and Management Sciences from Eindhoven University of Technology and a Master's in Business Economics from Tilburg University. Dimitri Chatzoudis is Portfolio Manager Institutional Emerging Markets Accounts. As a Research Analyst he covers the team’s investments in Mexico. Before joining Robeco in 2008, he was Portfolio Manager Eastern European and Global Emerging Markets at ABN AMRO. He started his career in the industry in 1993. Dimitri holds a Master’s in Industrial Engineering from Eindhoven University of Technology and is a Certified European Financial Analyst. Dimitri is also fluent in Greek. Jaap van der Hart is the Lead Portfolio Manager of Robeco’s High Conviction Emerging Stars strategy. Over time, he has been responsible for the investments in South America, Eastern Europe, South Africa, Mexico, China and Taiwan. He also coordinates the country allocation process. He started his career in the investment industry in 1994 at Robeco's Quantitative Research department and moved to the Emerging Markets Equity team in 2000. Jaap holds a Master's in Econometrics from Erasmus University Rotterdam. He has published several academic articles on stock selection in emerging markets. Cornelis Vlooswijk is Lead Portfolio Manager and Research Analyst African Equities. Previously, he worked for Robeco as an investment strategist focusing on North America and Emerging Markets since 2005. Before joining Robeco in 2005, he worked for Credit Suisse First Boston as an Investment Banking Analyst, focusing on the transport and logistics sector. He started his career in the financial industry in 1998. Cornelis holds a Master’s in Economics from Erasmus University Rotterdam and is a CFA® charterholder.

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 incorporates sustainability in the investment process through exclusions, ESG integration, engagement and voting. The fund does not invest in issuers that are in breach of international norms or where activities have been deemed detrimental to society following Robeco's exclusion policy. Financially material ESG factors are integrated in the bottom-up investment analysis to assess existing and potential ESG risks and opportunities. In the stock selection the fund limits exposure to elevated sustainability risks. In addition, where a stock issuer is flagged for breaching international standards in the ongoing monitoring, the issuer will become subject to engagement. Lastly, the fund makes use of shareholder rights and applies proxy voting in accordance with Robeco's proxy voting policy.

In April, emerging markets declined by 2.7% in euro terms, lagging the 0.1% return for developed markets. The best emerging countries were the Central European countries (Hungary, Poland and the Czech Republic), Indonesia and the UAE, while China, Turkey and Taiwan were the worst performing ones. China's economic recovery after the end of the Covid measures is happening, with Q1 GDP growth at 4.5%, and improving retail sales and export numbers. Yet the market was still down on some geopolitical concerns and high expectations at the start of the year. Turkey will have elections in May, which will be a close race between President Erdogan and opposition leader Kilicdaroglu. Inflation is gradually coming down across emerging markets, and interest rates have largely been kept stable in April.

Based on transaction prices, the fund's return was -0.51%. The fund had a solid outperformance versus the benchmark (MSCI EM) in April, with most of the contribution coming from stock selection. Country allocation made a small positive contribution. In country allocation, the main positive contributions came primarily from the overweight positions in Indonesia, Hungary and Greece. The underweight position in Saudi Arabia detracted the most from the relative performance. From a stock selection perspective, positive attribution came particularly from China, South Korea and Indonesia. In China, our stock selection in communication services (underweight Tencent), consumer discretionary (Gree and Haier Smart Home) and financials (Ping An, PICC) added positively to the relative performance. In South Korea, the selection in industrials (Doosan Bobcat), consumer discretionary (Hyundai Motor) and materials (LG Chem) outperformed the benchmark. In Indonesia, Bank Rakyat showed a nice performance. The selection in India and South Africa detracted the most from performance, although the impact was relatively small. In India, the selection in financials showed a disappointing return and in South Africa, Naspers underperformed the benchmark.

The global environment is still challenging for equity markets, as inflation remains relatively high and global central banks have continued to raise interest rates. This has led to financial stress for some European and US banks, and global growth is likely to slow down. Emerging markets, however, seem relatively well positioned, as inflation is actually lower in many countries, they were earlier in hiking interest rates in this cycle and growth in China is picking up after the end of the zero-Covid policy. After last year's correction, market valuations have become more attractive, and in particular for emerging markets they are now at longer-term averages. In addition, emerging markets are attractively valued relative to developed markets with discounts of around 30% based on earnings multiples.