The fund returned 10.9% for the quarter, underperforming the benchmark by 0.6%. The MSCI ACWI Index ended 11.5% higher, with the biggest gainers being the Netherlands and Germany, increasing 18.3% and 16.3% respectively. The MSCI Emerging Markets Index increased by 12% driven by impressive gains in South Korea and Taiwan, increasing 32.8% and 26.1% respectively (all in USD).
US equities ended the quarter 11.2% higher; however, they experienced pronounced volatility following President Donald Trump’s ‘Liberation Day’ announcements of tariffs on imported goods. The new tariffs were later suspended for 90 days across most countries, resulting in the subsequent rebound of shares, with the S&P500 registering an all-time high by quarter-end. The US economy contracted at an annualised rate of 0.5% in the first quarter, primarily due to a surge in imports ahead of anticipated tariffs and a decrease in government spending. The labour market remained strong, while CPI inflation continued to slow over the period. Despite these mixed signals, the Fed maintained its benchmark interest rate at 4.25% – 4.5%, citing increased economic uncertainty and the potential risks posed by new tariffs. European equities rallied 11.4% over the quarter, with robust performances from the Netherlands and Germany, increasing 18.3% and 16.3% respectively. Germany’s equity rally was driven by fiscal stimulus plans, easing US trade tensions and renewed investor interest in undervalued European stocks. The region saw strong corporate earnings, declining inflation pressures and a further 50 basis points cut to rates by the ECB to 2%. Within Emerging Markets, South Korea surged 32.8%, driven by post-election optimism, the government led “Value Up” reforms to boost corporate valuations and a rally in financials, industrials and large-cap exporters and chipmakers like Samsung, SK Hynix, Hyundai and Kia. Taiwan’s market gained 26.1%, driven by booming AI-related semiconductor demand, easing US-China trade tensions, and strong foreign capital inflows.
On a sector level, Health Care and Energy were the worst-performing sectors over the quarter. The energy sector was dragged lower by the oil price declining 9.5% over the period, where the fund’s underweight holding added to relative performance. The overweight holding in health care and the underweight in industrials, however, detracted from relative performance. The Trump administration is seeking to lower drug prices in the US, which has pressured the healthcare sector. The Information Technology sector was the best-performing sector over the period, where the fund’s overweight positioning contributed to relative performance. Stock picking within the consumer discretionary and financials sectors detracted from relative performance, while stock picking within the materials and the consumer staples sectors added to relative performance.
Noteworthy portfolio actions over the quarter included partially switching the funds’ EM technology exposure in Pinduoduo and Prosus into a larger position in JD.com, as well as topping up the existing positions in the DM technology businesses of Google and Applied Materials. The fund holdings in Ross Stores, Sysco, UnitedHealth Group and Vertiv Holdings were sold during the quarter. New positions were initiated in Progressive Corp, Lowe’s, Goldfields and Fiserv, while the positions in BP and Glencore were topped up on weakness.
Notable contributors to fund performance were positions in Microsoft (+153bps absolute, +39bps relative), Nvidia (+93bps absolute, -64bps relative) and Broadcom (+63bps absolute and relative). Notable detractors from performance over the quarter came from JD.com (-68bps absolute and relative), Pinduoduo (-58bps absolute and relative) and Kaspi (-45bps absolute and relative).
The fund is positioned with an underweight in the cyclical and defensive names, in favour of EM technology exposure and a neutral DM technology holding. From a geographical perspective, the fund remains underweight in the US and Canada, while being overweight in China through technology shares and Kazakhstan through financial shares.
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Disclaimer
Fairtree Asset Management (Pty) Ltd is an authorised financial services provider (FSP 25917). Collective Investment Schemes in Securities (CIS) should be considered as medium to long-term investments. The value may go up as well as down and past performance is not necessarily a guide to future performance.
CISs are traded at the ruling price and can engage in scrip lending and borrowing. A schedule of fees, charges and maximum commissions is available on request from the Manager. A CIS may be closed to new investors in order for it to be managed more efficiently in accordance with its mandate. Performance has been calculated using net NAV to NAV numbers with income reinvested. The performance for each period shown reflects the return for investors who have been fully invested for that period. Individual investor performance may differ as a result of initial fees, the actual investment date, the date of reinvestments and dividend withholding tax. Full performance calculations are available from the manager on request. There is no guarantee in respect of capital or returns in a portfolio. Prescient Management Company (RF) (Pty) Ltd is registered and approved under the Collective Investment Schemes Control Act (No.45 of 2002). For any additional information such as fund prices, fees, brochures, minimum disclosure documents and application forms please go to www.fairtree.com.
Highest rolling one-year return 29.59% (Benchmark: 34.17%) and lowest rolling one-year return -17.19% (Benchmark: -18.73%) (information as at 30 June 2025). The Fund has returned an annualised return of 9.66% since inception (September 2021) (benchmark annualised return of 10.15% since inception). The Fund’s annualised performance over one-year is 12.70% (Benchmark: 16.25%). Fund returns disclosed are annualised returns net of investment management fees and performance fees. Annualised return is weighted average compound growth rate over the period measured. Fund investment risk indicator level: aggressive. Full performance calculations are available from the manager on request. Annualised performance: Annualised performance shows longer term performance rescaled to a 1-year period. Annualised performance is the average return per year over the period. Actual annual figures are available to the investor on request. Highest & Lowest return: The highest and lowest returns for any 1 year over the period since inception have been shown. NAV: The net asset value represents the assets of a Fund less its liabilities.
This document is confidential and issued for the information of the addressee and clients of Fairtree Asset Management only. It is subject to copyright and may not be reproduced in whole or in part without the written permission of Fairtree Asset Management. The information, opinions and recommendations contained herein are and must be construed solely as statements of opinion and not statements of fact. No warranty expressed or implied, as to the accuracy, timeliness, completeness, fitness for any particular purpose of any such recommendation or information is given or made by the Manager in any form or manner whatsoever. Each recommendation or opinion must be weighed solely as one factor in any investment or other decision made by or on behalf of any user of the information contained herein, and such user must accordingly make its own study and evaluation of each strategy/security that it may consider purchasing, holding or selling and should appoint its own investment or financial or other advisers to assist the user in reaching any decision. The Manager will accept no responsibility of whatsoever nature in respect of the use of any statement, opinion, recommendation, or information contained in this document. This document is for information purposes only and does not constitute advice or a solicitation for funds.
The Fairtree Global Equity Fund is registered and approved under section 65 of CISCA.
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