What is your opinion on the geopolitical context and how investors behave?
We are at a time when the rate hike must stop if we do not want to suffer a violent recession. However, we can only see a fairly strong resilience of the global economies post-covid. From a geopolitical point of view, the Cold War blocs are being reconstituted. Beijing has previously expressed concern about US policy, which encourages the formation of regional blocs. Washington and Beijing remain at odds over issues related to Taiwan, the South China Sea and Russia’s invasion of Ukraine.
In this context, we have performed well in our management, at the same time reducing the sensitivity of our portfolios to economic risks.
As for investors, they take refuge in low curve products (monetary and bond products) that are in a profitability range of 3 to 7.5%. So why look for risk in the stock market when the rate environment induces monetary products with yield ranges ranging from 3.5 to 4.5%? Volatility and risk are lower. Therefore, it is a relatively wait-and-see position, on the part of institutional investors, who essentially buy sovereign bonds, and individuals who take refuge in lower curve products. Today in returns, theEster (European Short Term Rate) is at 3.90% which means that a monetary product well priced It amounts to more than 4% net of commissions.
It proposes an asset hybridization approach, what does it consist of?
Our approach is to combine traditional listed assets and unlisted assets such as private debt, private equity or even infrastructure or real estate. Our mission is to bring an innovative and socially responsible perspective to asset management by combining different approaches to optimize long-term performance and offer less volatile investment solutions to financial markets. Our hybrid products are made up of a maximum of 10% in unlisted funds. We reconcile the economy’s need for financing and the need for medium and long-term performance. Thanks to this approach, we combine higher return potential with lower volatility.
We hear a lot about “evergreen” funds, what are they for and how do they differ from their competitors?
Yes, they are proliferating, but not much in the French market. We are talking about democratization of access to private asset-type savings and “evergreen” vehicles respond to this, because they offer the ability to invest in private assets with a fairly high allocation. In an “evergreen” fund, we generally find a proportionality of 70% of assets allocated to private assets (private equity, infrastructure, private debt), as well as a liquid part that guarantees self-sustaining liquidity in the fund. This European and mid-cap strategy is part of the green industry law to direct part of the savings towards the productive economy, but whose acceptability by distributors is today much stronger, due to this liquidity pool that will mechanically reduce a little performance, while providing the important liquidity we need. Through this approach, we aim to generate solid returns while minimizing risks. To do this, we will be very selective in the choice of securities and will opt for great diversification, especially in terms of sectors and geographical areas.
He has developed expertise in ESG thematic funds, especially focused on “E” and “S”. Why invest in these funds and what are their characteristics?
Sienna Gestion formerly comes from the Malakoff Humanis group and its DNA focuses on responsible management. Most of the range benefits from SRI management (85% of assets) and almost 50% benefits from an SRI seal, Greenfin, CIES or Finansol, as of June 30, 2023. Two new funds have just been launched hybrids and a new hybrid fund. on the energy transition is scheduled for 2024. This will be composed of listed assets and private debt, promoting the energy transition. Today, the environment dominates extra-financial issues, while social issues remain marginal. There are two reasons for this: on the one hand, the legitimate media exposure of global warming and, on the other, the difficulty of obtaining data on social issues, often more qualitative than quantitative or even scientific. Given this observation, Sienna Gestion has chosen to highlight two social-themed funds: the first is a credit fund called Sienna Obligations Impact Social ISR and the second is an equity fund, Sienna Actions Solidaire Emploi Santé ISR. The first focuses on 3 social issues: inequalities between women and men, the inclusion of people with disabilities in companies and finally the employment of older people in companies. The second fund integrates an approach to analyze the social performance of issuers vis-à-vis their employees. We encounter the issues of disabilities, older people, women but also other issues such as the quality of employment or training.
Source: BFM TV
