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Analysis of the Multilabel SICAV Fund – Ethical ESG Global Equity
ESG funds

Analysis of the Multilabel SICAV Fund – Ethical ESG Global Equity

The investment team applies a philosophy that combines financial analysis with ESG analysis, favoring companies with a high sustainability profile and significant growth potential.
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1 FEB, 2024

By Andrea Sepúlveda from LatamSelf

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The Etica ESG Global Equity Fund was launched in December 2019, opening the possibility of evaluating its results and strategy over a three-year period. In this article, we will explore the key elements of this fund, examining its structure, investment strategy, and performance.

Strategy and investment philosophy

The strategy is part of the range of funds domiciled in Luxembourg by Etica Funds, an Italian management company committed to the research of ethical finance and responsible ESG investments since 2000.

The investment team, composed of Sofia Pescia, Carla Scarano, Pierluca Beltramelli, and Nicolò Vezzoso, applies a philosophy that combines financial analysis with ESG analysis, favoring companies with a high sustainability profile and significant growth potential.

Allocation and diversification

The fund adopts a global and diversified view, allocating at least 70% of assets to shares of companies listed on regulated markets in Europe, North America, and the Pacific area, including the Japanese region. Its flexibility also allows investments in bank deposits, liquid instruments, and currency risk hedging.

Active management and freedom of choice

Unlike many funds, the Etica ESG Global Equity Fund is actively managed and is not tied to a particular benchmark index. This freedom allows the investment team to select investments and determine their weighting according to their evaluation. Despite the absence of a benchmark in the strategy, investors tend to consider this fund as part of a global blend equity category to analyze it without the ESG bias.

Indicators and performance

At the end of December 2023, the fund had exceeded ~30 million USD in managed assets. The performance analysis of the fund is based on data from external sources, which use benchmarks such as Morningstar Gbl TME NR USD and Global Large Cap Blend Equity to compare its behavior over time.

Fund evolution

Note: Past performance does not predict future performance. The returns of the fund may increase or decrease due to exchange rate fluctuations. Source: Etica ESG Global Equity Class C - EUR as of 31/12/2023

Even though the fund does not have a benchmark that the investment team considers appropriate, it is suggested to consider a Global Equity type benchmark for comparison and better understanding of interested investors. Here the behavior of the fund is examined in relation to a category of this kind over different time horizons:

5 years3 years1 year6 months3 months1 month
Multilabel SICAV-ETICA SGR Global Equity C EUR acc --+5.46%+5.46%+3.98%+10.39%+0.90%
Global Large-Cap Blend Equity+9.47%+5.95%+10.03%+5.22%+8.90%+1.24%
Fund quartile--3rd4th3rd2nd3rd
Funds Category146818722359250425752652
25/February/2024. Source: https://markets.ft.com/ for the Ethical ESG Global Equity Fund Class C - EUR as of 25/01/2024, considering the Global Large Cap Blend Equity category.

Considering the benchmark assigned by this external source as the most appropriate for comparing the strategy, it can be stated that the fund is close to its 3-year category.

Source: https://markets.ft.com/ for the Ethical ESG Global Equity Fund Class C - EUR as of 25/01/2024, considering Morningstar Gbl TME NR USD as a comparison.


It is a fund that has a 3-year Beta less than 1, which indicates that it is more conservative than the category of funds it is compared with.

Other indicators of the Ethical ESG Global Equity Fund

Large positions
Security%
Nvidia CorpUS2.64
Adobe Systems IncUS1.68
Inter CorpUS1.53
Qualcomm IncUS1.52
LINDE PLCUS1.47
Total8.84
Source: Etica ESG Global Equity Class C - EUR as of 31/12/2023
Source: Etica ESG Global Equity Class C - EUR as of 31/12/2023

It is a fund that favors the United States and other developed countries in its allocation, which is predictable given the ESG orientation of the strategy, as these are the countries where it is possible to find more companies that take into account such considerations.

Conclusions

Advantages:

  • Belongs to a management company whose focus is ASG investment, so the team has all the support to implement its own philosophy and manage the fund looking for opportunities in this area.
  • It is an option for clients looking for strategies with an ASG approach and aligned with the United Nations Sustainable Development Goals.

Disadvantages:

  • Its size is still small to be considered within an institutional portfolio.
  • Despite its ASG focus, the fund needs to be more competitive in the category where an institution would place it to compete.
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