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This strategy focuses on companies where digitalization is reshaping the economy. Rapid changes are to occur in a number of subsectors. Disruptors have a global vision for how digitalization will reshape the business. Digital companies, particularly those related to a) customer engagement, b) creating better value for customers, and c) reshaping the route to market, are using digital tools such as e-commerce, AI/AR/VR, and in-depth knowledge as trends evolve quickly and abruptly.

This product takes advantage of the launch of the European Recovery Fund. Reasoning: The program and several other initiatives are industry supportive by a €130 bn tax cut package, spending and support for businesses spree, and a €50 bn “Green Marshall Plan” to overhaul and reinvigorate the currently diminished “green-orientated” industrial activity. The main beneficiaries of these programs are major companies; their credit stability is now at much higher levels than in the past. This product, with a remaining 4 ½ years, has a potential compounded return of 6% per annum.

In essence this is a business cycle play! Late cycle and Recession stock versus early cycle companies. The underlying portfolio favors early cycle sectors such as Industrials and Consumer Discretionaries, while we are less positive on Real Estate related companies. Or expressed differently, old versus new economy – the strategy is truly benefiting from the increasing of the gauge. The basket composition remains unchanged during the lifetime of the product.