Robeco FinTech X USD

Patrick Lemmens is Lead Portfolio Manager within the Trends Equities team. He has a focus on financials/fintech. Prior to joining Robeco in 2008, he managed the ABN AMRO Financials fund from October 2003 to December 2007. Previously, he held the position of Analyst of Global Financials at ABN AMRO and was Global Sector Coordinator of the Financial Institutions Equities Group at ABN AMRO. Patrick Lemmens started his career in the investment industry in 1993. He holds a Master's in Business Economics from Erasmus University Rotterdam and is a Certified European Financial Analyst. Michiel van Voorst is Co-Portfolio Manager within the Trends Equities team. He has a focus on financials/fintech/next digital billion. In 2019, Michiel rejoined Robeco from Union Bancaire Privée in Hong Kong where he was CIO Asian Equities. Prior to that, Michiel spent 12 years at Robeco in several senior positions including senior portfolio manager Rolinco Global Growth fund and Robeco Asian Stars. Prior to joining Robeco in 2005, Michiel was Portfolio Manager US Equity at PGGM and Economist with Rabobank Netherlands. Michiel started his career in the investment industry in 1996. Michiel van Voorst holds a Master’s in Economics from University of Utrecht and is a CFA® charterholder. Koos Burema is Co-Portfolio Manager within the Trends Equities team. He has a focus on financials/fintech. Koos was an Analyst with the Emerging Markets team covering Korea and technology in Taiwan and Mainland China. Besides this, he was responsible for the integration of ESG in the investment process. Before joining the team in January 2010, he worked as a Portfolio Manager for different sector teams within Robeco. He started his career in the industry in 2007. Koos holds a Master’s in Business Administration from the University of Groningen 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 0.05% 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 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.

Central banks keep on raising rates, while one after the other US bank is failing. Credit Suisse has been rescued and all around the world there are worries about Office CRE. As we get closer to a formal recession, the question is when will central banks stop hiking. For us that would be the time to move more into high-growth stocks with a reasonable valuation. Financial infrastructure has been a tough place to invest in April and YTD. Fears for poor results in banking technology enablers did not pan out, as Q1 results have been okay. In financial management we are seeing the rise of non-traditional players like Apple, Amazon and Google. The EU voted in large numbers in favor of the Markets in Crypto Assets (MiCA) legislation, which establishes rules for crypto-asset issuers and service providers, DeFi, and market abuse. Outside the US and Europe, we observe continuous regulatory developments. In our view, this implies that activity, capital and innovation will shift away from the US.

Based on transaction prices, the fund's return was 0.57%. April was a very difficult month, in which financials as well as (fin)tech stocks struggled, which led to an underperformance. The payments segment was the one clear positive standout. Partly because of the bid on one of our holdings, Network International, and partly thanks to solid performance from our investments in Latin American payments companies. The largest performance differences on a GICS industry level were seen, with positive contributions coming from IT services (StoneCo, Network International), banks (The Bancorp, NU Holdings) and consumer finance (Bajaj Finance, Kaspi). Software (Qualys, Blackline), interactive media & services (Tencent) and capital markets (MSCI, TradeWeb) were the worst relative industry contributors to performance during April.

There has been a significant valuation reset. We still see solid growth potential across the fintech investment universe. Though there is a significantly larger focus on the ability to generate cash and profitability. Payments should continue to outgrow nominal GDP, especially digital payments, as e-commerce grows faster with continued higher adoption rates. Data analytics has been a growing part of the fintech investment universe. The (December 2022) announced deal between Microsoft and LSE Group underscores the importance of DA. Enhancing financial inclusion remains a very important raison d'etre (reason for existence) for fintech. In addition, we notice increasing importance of B2B business models in especially international / cross-border payments as well as in digital assets applications focused on wholesale business models. After a tough start of the year, we believe that fintech offers great long-term growth opportunities at much lower valuation multiples.