Investments in fund units are associated with risk. Past performance is no guarantee for future returns. The money invested in a fund can increase and decrease in value and it is not certain that you will get back the full amount invested. No consideration is given to inflation.
Catella Småbolagsfond is an actively managed fund whose objective is to deliver return that is higher than the average among the Swedish small cap companies included in the Carnegie Small Cap Return index.
To achieve that end, the fund invests in a concentrated portfolio of carefully selected Swedish small cap equities that the managers consider undervalued. The analysis process behind the fund's investments is based on Catella's fundamental analysis and broad expertise on Swedish companies. The fund applies negative screening for sustainability criteria and we consequently avoid long positions in companies that produce tobacco, alcohol, commercial games for money, pornography, coal, oil or weapons.
Since we expect fiscal measures in much of Europe over the next few years, we have continued to increase our holdings in industrial consultants ÅF-Pöyry and Sweco, as well as in waterproof membrane manufacturer Nordic Waterproofing. These companies benefit from increased infrastructure investment.
Henrik Holmer, 2019-08-30
Fund manager comment
August was a weak month for the world's stock exchanges. Continued geopolitical and economic concerns had a negative impact on the market and have resulted in sharp interest rate falls worldwide. The US-China trade conflict intensified again this month. China announced its intention to raise tariffs on US goods, and the Trump administration responded with higher tariffs on Chinese exports. Although talks between the two countries are planned, it feels like they are currently a long way apart. The minutes of the US Federal Reserve meeting revealed that the interest rate cut in July was a result of worries about weaker economic growth and lower inflation. However, the members disagreed and the majority wanted to hold off lower interest rates while others wanted to be more aggressive and advocated a 0.5 percentage point cut.
Catella Småbolagsfond was down 2.2 percent this month, compared to the Carnegie Small Cap index which fell 0.9%. One sector that benefits from the sharp fall in interest rates is real estate, which continues to perform very strongly. The fund's relative winners compared to index this month (Kungsleden and Balder) and its relative losers (Castellum and Sagax) are therefore found in this sector. Since we expect fiscal measures in much of Europe over the next few years, we have continued to increase our holdings in industrial consultants ÅF-Pöyry and Sweco, as well as in waterproof membrane manufacturer Nordic Waterproofing. These companies benefit from increased infrastructure investment. We have also continued to increase our holdings in forest products companies Holmen and SCA, where we see attractive valuations and hidden values in their forest assets. During the month, Holmen announced that it intends to repurchase 10 percent of its outstanding shares, and SCA announced investment of SEK 7.5 billion in a kraftliner machine in Obbola, Umeå Municipality.
Fund Facts
Risk Indicator
The risk and reward indicator illustrates the link between risk and potential returns from an investment in the fund. The indicator is based on how the fund’s value has changed over the past five years. Category 1 does not mean that the fund is risk free. The fund may over time move towards the left or right of the scale. This is because the indicator is based on historical data which is not a guarantee of future risk and reward. For information about the risk classification of each fund, please refer to the fund’s key investor information document.
Fact
Catella Småbolagsfond invests in Swedish small caps and focuses on finding undervalued companies. Genuine stock picking, in other words.
The fund is intended for investors seeking exposure to Swedish small caps, with a higher expected return than the Swedish stock market indices and who have an investment horizon of at least five to seven years. The fund is permitted to use derivatives and the net asset value of the fund may fluctuate considerably.
