Fund commentary

Aviva Investors Climate Transition Global Equity Fund

Month in review for January 2024

Max Burns

Fund Manager

Summary

Month in review

The fund made a positive start to the year in terms of both absolute and relative performance. Global equities advanced as investors become increasingly confident that the US economy was set for a soft economic landing. The fund’s overweight exposure to information technology added value over the month, offsetting a performance drag from its utilities positioning.

Looking ahead

We continue to position the fund conservatively, focusing on companies that meet our climate transition mandate and that possess resilient business models.

Key facts

Fund managers
Max Burns since 07/2021,
Andrea Carzana since 03/2022
Share class inception date
08/06/2020
Fund size (as at 29/02/2024)
GBP 772.5m
Benchmark
MSCI ACWI GR GBP

Fund overview

Objective: To grow your investment over and provide an average annual net return greater than the MSCI® All Country World Index over a 5-year rolling period by investing in shares of global companies responding to climate change by orientating their business models to be resilient in a warmer climate and a lower carbon economy; or providing solutions to mitigate climate change or help communities adapt to the adverse impacts of climate change.

Month in review

The fund made a positive start to the year in terms of both absolute and relative performance. Global equities advanced as investors became increasingly confident that the US economy was set for a soft economic landing. There were also continued expectations that interest rate cuts would start to be delivered some time in the first half of 2024.
The fund’s overweight exposure to information technology added value over the month, offsetting a performance drag from its utilities positioning. At the individual stock level, the main contributors included United Rentals, an equipment rental company for manufacturing operations that is positively exposed to our circular economy theme and is progressing well against its carbon reduction targets, ASM International, a semiconductor manufacturer aiming to be a net zero company across its value chain by 2035, and global software company Microsoft, which is demonstrating strong progress towards its targets to achieve scope 1 and 3 carbon neutrality by 2025 and scope 3 carbon neutrality by 2030.
The main drags on performance were renewable energy operator EDP Renewables and construction materials maker Sika.

 

 

 

 

 

Performance

For the latest Monthly, Cumulative, and Annualised Fund performance data please refer to the PDF factsheet below.

Past performance is not a guide to future performance
Performance basis: Month end returns, Mid to mid, net income reinvested, net of ongoing charges and fees, in the share class currency and net of tax payable by the fund. The figures do not include the effect of any exit or entry charge.

The Fund's performance is measured against the MSCI® All Country World Index.

Looking ahead Last updated 31 January 2024

Economic data, particularly in the US, continues to be supportive of risk assets. Uncertainty nevertheless remains high, as the path forward for central banks to close the remaining gap towards their inflation target is the trickiest to manage.
We continue to believe that the fund is positioned to benefit from the challenges that climate change poses and the opportunities that it may bring for businesses that are positioned in the right way.
Tactically, we continue to take a conservative stance, focusing on companies that meet our climate transition mandate and that possess resilient business models. We believe our holdings will continue to generate significant free cash flow and robust returns on invested capital, which should prove defensive in a global recessionary environment.

Risks

Full information on risks applicable to the Fund are in the Prospectus and the Key Investor Information Document (KIID).

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Access key fund documentation and performance reports.

Important information

THIS IS A MARKETING COMMUNICATION

The source for all performance, portfolio and fund breakdown data is Morningstar unless indicated otherwise. For share classes that have not yet completed 5 years, the cumulative performance chart will start from the first full month. All data is as at the date of the Factsheet, unless indicated otherwise.

Unless stated otherwise any opinions expressed are those of Aviva Investors. They should not be viewed as indicating any guarantee of return from an investment managed by Aviva Investors nor as personalised advice of any nature. This document should not be taken as a recommendation or offer by anyone in any jurisdiction in which such an offer is not authorised or to any person to whom it is unlawful to make such an offer or solicitation. Portfolio holdings are subject to change at any time without notice and information about specific securities should not be construed as a recommendation to buy or sell any securities.

For further information please read the latest Key Investor Information Document and Supplementary Information Document. The Prospectus and the annual and interim reports are also available on request. Copies in English can be obtained, free of charge from Aviva Investors, PO Box 10410, Chelmsford CM99 2AY. You can also download copies at www.avivainvestors.com

Issued by Aviva Investors UK Fund Services Limited, the Authorised Fund Manager. Registered in England No. 1973412. Authorised and regulated by the Financial Conduct Authority. Firm Reference No. 119310. Registered address: St Helen’s, 1 Undershaft, London EC3P 3DQ. An Aviva company.

MSCI makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used as a basis for other indices or any securities or financial products. This report is not approved, endorsed, reviewed or produced by MSCI. None of the MSCI data is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such.