Robeco Digital Innovations I USD

Marco van Lent is Lead Portfolio Manager Robeco MegaTrends/Rolinco, Portfolio Manager Robeco Digital Innovations and member of the Robeco Trends Equities team. Before 2013, he managed Robeco Infrastructure Equities. Marco joined Robeco in October 2007 to co-manage two European equity funds. He worked at Van Lanschot Asset Management to manage the Van Lanschot European Equity Fund. After the acquisition of Kempen Capital Management by Van Lanschot, he worked at Kempen Capital Management for six months to manage European equity mandates. He was Portfolio Manager European equities at Philips Investment Management in the period 1999-2005 and in the period 1996-1999 he was Portfolio Manager at Van Spaendonck Asset Management. He started his investment career in 1985 as a sell-side analyst/strategist. Marco holds a Master's in Business Economics and Finance from Tilburg University. Steef Bergakker is Portfolio Manager Robeco MegaTrends/Rolinco, Portfolio Manager Robeco Digital Innovations and member of the Robeco Trends Equities team. Previously, he was trends researcher within the Trends Equities team and has authored several white papers. Before that, Steef was portfolio manager of Robeco Infrastructure Equities and Robeco Hollands Bezit. Prior to rejoining Robeco in 2008, Steef held different functions at IRIS (Institute for Research and Investment Services), the former research joint venture of Robeco and Rabobank. From 1998 through 2008 he served as head of IRIS Equity Research, and before that he worked as equity analyst for eight years. Steef started his career in the investment industry at Robeco in 1990 as an analyst. He holds a Master’s in Monetary Economics and Finance and Investments from Erasmus University Rotterdam.

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.

Global equities continued their upward march at the beginning of February and the index gained another 2.5% in the first two weeks. Not even the Fed hiking rates by another 25 bps and the ECB by even 50 bps were able to derail the rally. But after a spate of hotter-than-expected US economic data, investors quickly started to re-price the yield curve, incorporating a delayed end to the tightening cycle with higher peak rates. As a result, the yield on 10-year Treasuries rose from roughly 3.5% at the start of the month to 3.92%, with the 2-year yield pushed to the highest level (4.83%) since 2007. The 10-year Bund yield shot up as well over the period, from 2.28% to 2.65%.

Based on transaction prices, the fund's return was -0.66%. The fund strongly outperformed the reference index, with all three trends contributing positively. Secure Digital Infrastructure and Robotics & Automation were the best-performing trends in February. It was again mainly the cybersecurity names that did well. The Digital Enablers trend was flattish. The top three stocks for February were Palo Alto Networks, NVIDIA and Fortinet. The bottom three stocks were Keysight, American Tower and Emerson Electric.

The business world is constantly looking for improvements in productivity, efficiency and flexibility. The combination and confluence of increasing connectivity, digitization of products and services and digitization of business processes is providing abundant opportunities to make tremendous progress in these respects across virtually every industry. It is this digital transformation of business enterprise that Robeco Digital Innovations is designed to capture. We continue to believe that the secular trends outlined above remain valid and, if anything, have been reinforced by the Covid pandemic. In addition to seeking productivity and efficiency gains, minimizing exposure to human vulnerabilities, such as a pandemic, has come to the forefront as a forceful argument to expedite the digital transformation of business. The long-run prospects are very bright, but the short-run outlook has turned uncertain, as a hawkish monetary policy to counter inflationary pressures may curtail economic growth or even cause a recession. We therefore proceed with caution in the near term, while remaining optimistic for the longer term.