Report September 2022

September ends with sharp drops in the equity market. The stock market’s status quo, has not fundamentally changed. Everything is still focused on inflation. The message from the central banks has been clear: The priority is to control inflation, even at the cost of sacrificing more growth and employment. In recent weeks, this has led to increased expectations of further interest rate hikes, and the conviction that these will remain high for longer.

Pareturn GVC Gaesco Columbus European Equity Fund Class I fell 10.63% during September, worse than European stock markets. Since its inception in June 2008, Columbus has returned 103.38%, far outperforming European equity indices. The volatility during the last twelve months has been 20%.

We continue to think that the key to the behaviour of the markets is the future evolution of inflation. The falls we have seen in the price of oil and other raw materials, as well as the easing of supply chain disruptions and improvements in freight prices should result in lower inflation. We believe that these decreases will begin to materialize in the last quarter of this year and especially in 2023 when last year’s energy increases will fall out of the calculation.

In many aspects, the fundamentals remain favourable: labour demand is at record levels both in the US and Europe, the financial system is well capitalized, families have high levels of savings accumulated during the pandemic, companies have not increased their productive capacity. Nevertheless, growth in 2023 will be weak with a growing risk of recession, especially in Europe (late 2022-early 23) and in the US next year.

As for the portfolio, the fund underperformed the market over the month, with many companies falling sharply, with no news on individual stocks. Highlights, on the positive side:

  •   Ariston (+17.06% in September). The Italian heater company announced the purchase of Centrotec Climate Systems GmbH. The acquired company is a world leader in heat pumps. It is an acquisition that complements the range of Ariston products and allows entry into other segments such as ventilation.
  •   Krones (+10.35%). The German bottling machinery company raised its expected sales guidance for this year, while hoping to maintain its margins. During the month, we also completed the sale of VGP, Safestore and Dormakaba.

We reiterate what we said last month: we think that stock markets will react positively when we start to see better inflation data, in the last quarter of this year and in the first quarter of next year. European equity valuations are below their average valuations in recent years, mutual funds have increased their cash levels dramatically and investor pessimism is at its highest level since 2009. All of these are positive indicators for future stock behaviour. We do not know if it is the best time to buy but it is a good time.


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We thank you for your trust and wish the best to you and your families during these uncertain times.

Since June 14, 2018, both national and foreign investors can access the Columbus strategy through the Master-Feeder structure between Columbus 75 Sicav in Spain (feeder) and the registered Pareturn GVC Gaesco Columbus European Midcap Equity Fund in Luxembourg (master). The Luxembourg vehicle offers institutional and retail share classes denominated in euros. We have also just set up a sterling share class to facilitate investment from the UK.