News / Insights

  The low-interest environment returns problem – do dividend stocks offer a way out?

In a sustained low interest rate environment, dividend stocks are an essential component in maintaining real purchasing power and achieving positive returns after inflation. Dividend stocks enable investors to participate in a broad equity market and to receive continuous distributions.

The low interest rate environment coupled with inflation results in a toxic mix for German investors
Real returns, i.e. the interest income after deduction of the inflation rate, of investors in Europe will in future be just around zero percent. These are the results of a recent study by the independent financial services provider MainFirst. Thomas Meier, Head of Equity Fund Management at MainFirst, describes this trend as worrying. To give one example, calculations by the Bundesbank show that the asset allocation of private households in Germany over the past ten years has enabled an average adjusted increase in value of 1.4 percent per year. Over the past 20 years, the increase in value even reached 2.6 percent per year. However, such returns can no longer be achieved today with an average German portfolio due to the ongoing low-interest rate phase. A new weighting must therefore be given to asset allocation – if money is not to dwindle away. 

The way out of the dilemma: dividend stocks 
In order to be able to generate attractive returns today, investors must rethink their approach. Investors can only achieve higher returns through a change in portfolio allocation away from cash, insurance, pension provisions and similar investments - a share that currently averages 77 percent in German portfolios. In other words, investors will not be able to achieve their savings targets without a significant increase in the equity component, which still has the most attractive performance potential in the long term.

Dividend stocks offer a particularly high return potential, as higher pay-out ratios could be observed here in recent years. In 2018, distributions in Germany totalled more than 50 billion euros for the first time. Despite the more difficult environment, current estimates anticipate further increases for 2019. Investors should therefore pay attention to the quality of dividends when selecting stocks so that returns are as attractive and sustainable as possible. Such dividend stocks can be found above all, where robust business models are in place. The MainFirst Global Dividend Stars is an example of a fund that has equities with high quality, sustainable dividends in its portfolio.

Targeted investment in high-quality dividend stocks 
The fund managers of MainFirst Global Dividend Stars, Thomas Meier and Christos Sitounis, rely on focused stock picking. They invest independently of the benchmark in companies with above-average dividend quality. The decisive factor is not the amount of the dividend, but the sustainability of the distributions. In the view of the fund managers, such dividend distributions are mainly found where robust business models with strong balance sheets, high structural profitability and solid substance are found. In addition to established, defensive large caps, they add more dynamic small and mid-caps that have a higher potential for growth to create a balanced, attractive risk-return profile for investors. To ensure the sustainability of dividend payments, the extent to which the payments are covered by business development and the achievement of a positive free cash flow is determined. Finally, a company is analysed based on valuation ratios in a peer group comparison. If a security has withstood this extensive review, it is usually included in the portfolio on a long-term basis. In addition to individual developments, the team continuously monitors around 600 companies worldwide, with direct company contacts at the heart of the analysis process. The management conducts a total of approximately 300 meetings per year, mainly with decision-makers from companies.

The MainFirst Global Dividend Stars is thus an actively managed fund with a bottom-up-driven stock selection. Its focus lies on substantial dividend titles and the systematic admixture of growth-strong small and mid-caps. Not only in view of the low interest rate environment does it offer an attractive alternative to savings deposits.



  MainFirst Bank AG becomes Euronext Paris listing sponsor

Frankfurt am Main, 23 January 2018 – MainFirst Bank AG, a leading European equity research and brokerage firm, is celebrating its accreditation as a Euronext listing sponsor today with a bell ringing ceremony in Paris. As a listing sponsor, MainFirst Bank AG will support companies of all sizes wishing to list on Euronext – both before and after their IPO. For example, MainFirst Bank AG will assist businesses in evaluating the most suitable market for them and meeting the regulatory challenges involved in an IPO. And, in the post-IPO period, MainFirst Bank AG will advise the companies on compliance with statutory and regulatory requirements and contractual obligations and serve as their main contact for Euronext.

“We are delighted to have been accredited as a Euronext listing sponsor,” said Ebrahim Attarzadeh, CEO at MainFirst Bank AG. “The listing sponsor accreditation emphasizes our high level of competence in allcapital market business matters.” Euronext requirements for accreditation in this capacity include comprehensive expertise in advising businesses on their capital structure and strategy, a proven track record in equity transactions, qualified and experienced staff and adherence to certain compliance requirements.

“We are delighted to have been accredited as a Euronext listing sponsor,” said Ebrahim Attarzadeh, CEO at MainFirst Bank AG. “The listing sponsor accreditation emphasizes our high level of competence in allcapital market business matters.” Euronext requirements for accreditation in this capacity include comprehensive expertise in advising businesses on their capital structure and strategy, a proven track record in equity transactions, qualified and experienced staff and adherence to certain compliance requirements.

“It is an honour for us as a Euronext listing sponsor to work even more closely with companies in Euronext core markets too. This means we can jointly develop appropriate capital market strategies and monitor them in their IPO,” Attarzadeh said. “Accreditation as a Euronext listing sponsor dovetails with ou rEuropean growth strategy. Our acquisition of the institutional brokerage business in European equities from Raymond James in Paris and London will enable us to further expand our strengths in distribution and research. We would also like to expand the M&A advisory business, fixed income and debt capital markets following Stifel's planned purchase of MainFirst Bank AG,” Attarzadeh stressed.

MainFirst Bank AG acquired the institutional brokerage business in European equities from Raymond James in Paris and London in December. The merger with the leading full-service middle-market investment bank Stifel Europe is expected to be completed in the first quarter of 2019. It will create a pan-European platform with deep local expertise and distribution power throughout Europe's major markets. MainFirst Bank AG will also add significant capital raising abilities to Stifel’s strong equity issuance business.



High potential for growth in Emerging Markets

Wednesday, 23. January 2019, 15:00 - 15:45

SEMINARRAUM ІІ, Zürich-Oerlikon, Stage One

by Thomas Rutz

As large positions in US Dollars, equities and DM bonds start to unwind, the resulting inflows to EM should translate in materially stronger growth. Expectations are that the USD will weaken and US equities and DM bonds underperform as the business expansion is late cycle.

By contrast, the EM cycle is at an early stage and assets are posed to relatively outperform. Dislocations in EM currencies, attractive credit spreads and higher commodity prices provide a good backdrop for new investment opportunities in high growth sectors.

The MainFirst EM Credit Opportunities Fund is a highly diversified mix of distressed, high yield and commodity plays, managed by an expert team with a proven track record following a very strict relative value, bottom-up security selection process. The annualized performance over three years was 9.37 percent (as at 28 December 2018, ISIN: LU1061984545).


The MainFirst Emerging Markets Team expects that given the still healthy global economy, EM is set to grow more than developed countries 

Strong fundamentals point to performance potential in emerging markets 
Emerging market corporate bonds should deliver solid returns in the coming years as the fundamentals of EM companies remain strong and continue to have upside potential, as they are considerably less levered, and, thus, have more room for manoeuvre than companies in developed countries. For example, bonds in the JP Morgan Corporate Emerging Market Bond Index (CEMBI) have an identical risk-reward profile to USD and EUR high yields. Moreover, in contrast to industrialized countries, emerging markets are still early cycle or at most in the middle of the cycle and there is, therefore, still a lot of growth potential. This makes many emerging market corporate bonds very attractive.

The global economy is also still in a healthy state, despite the slowing in growth it has recently seen. And the MainFirst Emerging Markets Fund Management Team, consisting of Cornel Bruhin, Dorothea Fröhlich and Thomas Rutz, do not foresee a recession in the next 12-18 months. Rather, they expect that the current business cycle will continue, albeit with weaker global growth, that positive developments on the trade front between the US and China will start to take effect, and that the Chinese measures of easing should start to affect the real economy by mid-2019. While it may still take a few months for this stabilisation to become visible, constructive outcomes of the trade negotiations should have a further positive influence on this trend. 

Favourable factors boosting emerging markets 
Over the last year, emerging market assets have generated significantly better risk-adjusted returns than comparable investments in developed markets. For example, CEMBI high yields achieved equity-like returns while their volatility was only one-third as high. A comparable portfolio without emerging market positions performed weaker than one with EM positions. The MainFirst Emerging Markets Team expects this trend to continue in the coming years.

According to them, the fundamentals of EM corporates are now in the best shape they have been in since the global financial crisis. EBITDA generation has also been strong, growing at 27 percent in the second quarter of 2018.  Most importantly, many companies are employing a more prudent approach and the balance sheets of many companies are improving. This means that compared to the previous cycle, CAPEX strategies are more defensive, cash balances are higher and corporate governance has improved. Overall, EM corporates have been deleveraging due to the strong EBITDA generation and moderate new debt issuance.

Moreover, EM default rates have fallen significantly from their November 2016 peak, which strongly indicates the beginning of a new credit cycle. The global growth trend – even if more moderate now – still supports corporate earnings growth further and leads to higher cash holdings and lower debt. On top of that, commodity markets are balanced, which is why the team expects the commodity cycle to continue and emerging markets to be buoyed by this.

Another positive influence should come from the US Dollar, which is likely to weaken in 2019 as the global economy rebalances away from the 2018 US-led growth trend. The team views the recent FED communication as dovish enough and believe that the FED will be particularly careful in further hikes down the road, meaning that the currently foreseen two hikes do not have to happen necessarily in 2019 and will depend on the US and global economy in 2019. The team already predicted a year ago that the US 10-year benchmark yields would be in the range of 2.75-3.25 percent and not up to 4 percent – as assumed by many other market participants. Moreover, since the interest rate differential has narrowed again in the last few weeks and the carry situation is somewhat less attractive than a few weeks ago, the team feels that many investors are still heavily overweight in their US Dollar asset allocation and see this as not based on sound fundamentals.

What this could mean for investors 
Based on this, the team expects that EM corporates will be more resilient – even in a bearish economic scenario – than their US and EU high yield peers and are likely to outperform them. The described outlook also leads them to the view that, in terms of risk-reward, credit is a much more attractive asset class than equity – always only if investors have in-depth knowledge and know how to choose well.

The team has acquired and established its expertise over the last 20 years and both their funds show this through their attractive returns. The MainFirst Emerging Markets Corporate Bond Fund Balanced C (ISIN LU0816909955) achieved an annualised performance of 8.2 percent over the last 3 years and currently has an attractive credit margin of 730 basis points while the Investment Grade corporate credit margin in the portfolio has a spread of well over 300 basis points. By comparison, JPM CEMBI Investment Grade is currently at 240 basis points. The MainFirst Emerging Markets Credit Opportunities Fund C (ISIN LU1061984545) achieved an annualised performance of 9.4 percent over three years and currently has a credit margin of almost 1000 basis points.

Regarding the general valuation, the current yields (Yield to Worst) on the two funds’ portfolios are extremely attractive with over 9.8 percent YTW and a credit margin of 730 basis points in the MainFirst Emerging Markets Corporate Bond Fund Balanced and over 12 percent in the MainFirst Emerging Markets Credit Opportunities Fund.

  MAINFIRST and ETHENEA combine their distribution support in new company

Frankfurt am Main, 9 January 2019 MAINFIRST Asset Management and ETHENEA Independent Investors S.A. are combining their distribution support in a newly formed company, FENTHUM S.A. Based in Luxembourg, FENTHUM is taking over the distribution support activities for both fund asset managers with immediate effect.
MAINFIRST will continue to manage the accounts of institutional investors and individual mandates for Germany and Austria directly. In this way, specific institutional requirements can be implemented easily and efficiently. Moreover, the close cooperation with the fund management and the dedicated account managers will continue to be available. 

"With FENTHUM, we gain a Europe-wide market presence and further expand the advantages for our clients by having a larger team available that possesses strong competencies to advise customers in more depth and at more locations," says Oliver Haseley, Managing Director of MAINFIRST Asset Management. FENTHUM is exclusively responsible for distribution support. "The independently managed companies MAINFIRST and ETHENEA will remain stand-alone companies and will continue to offer an independent, complementary product range," says Haseley.

In addition to the optimised service, the wider selection of funds also presents an advantage for customers. "The combined range from ETHENEA and MAINFIRST offers the ideal choice of portfolio solutions for each client profile," says Dominic Nys, Executive Director and Global Head of Business Development at FENTHUM S.A. " With the larger and more diverse team, we can provide the best possible client service. FENTHUM will support ETHENEA and MAINFIRST in offering existing clients an even better service and win over new clients with an attractive range of funds".

All three companies, MAINFIRST Asset Management, ETHENEA and FENTHUM, are majority-owned by Haron Holding. With the formation of FENTHUM, the three sister companies will focus even more strongly on their core business: a broad range of asset management solutions with excellent client service. 


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  EM corporate bonds: MainFirst expects solid returns over the next years and perceives interesting buying opportunities

 Frankfurt am Main, 13 December 2018. Emerging market corporate bonds should deliver solid returns in the coming years. Thomas Rutz, an Emerging Market expert at the independent financial services provider MainFirst, is convinced of this. "The fundamentals of EM companies remain strong and they have more room for manoeuvre than companies in developed countries," says Rutz. In his view, many emerging market corporate bonds are currently very attractive. Bonds in the JP Morgan Corporate Emerging Market Bond Index (CEMBI), for example, have an identical risk-reward profile to US and EUR High Yields. In addition, many EM companies still have upside potential, as they are considerably less levered. Moreover, in contrast to industrialized countries, emerging markets are still early cycle or at most in the middle of the cycle and there is, therefore, still a lot of potential. 

Points in favour of Emerging Markets 
In retrospect, emerging market assets have generated significantly better risk-adjusted returns than comparable investments in developed markets. For example, CEMBI High Yields achieved equity-like returns while their volatility was only one-third as high. A comparable portfolio without emerging market positions performed weaker than one with EM positions. According to Thomas Rutz, the fund manager of the MainFirst Emerging Markets Corporate Bond Fund Balanced and the MainFirst Emerging Markets Credit Opportunities Fund, this trend will continue in the coming years. The EM and frontier markets are very heterogeneous, and although some of the CEMBI zero volatility spreads have widened in recent months, the majority of emerging markets have proved quite resilient. Many of them now offer attractive entry opportunities, and the high yield market has not been as cheap as it is now since December 2016. In addition, EM default rates have fallen significantly from their November 2016 peak - "a sign that we are entering a new credit cycle," says Rutz. The balance sheets of many companies are improving. The global growth trend supports corporate earnings growth and leads to higher cash holdings and lower debt. In addition, commodity markets are balanced, which is why Rutz expects the commodity cycle to continue and emerging markets to be buoyed by this.

The impact of the US dollar is limited 
Rutz considers the impact of the US dollar on investments in emerging market corporate bonds to be limited. The development of the US currency remains an important factor for the performance of investments in emerging markets. "However, many EM companies hedge their currency risks or even receive cash flows in US dollar, so that the strength of the currency has only a limited impact on the balance sheets of such companies in emerging markets and can even have a positive effect," says Rutz. Emerging market currencies, however, have lost an average of around 14 percent in value since the beginning of the year and are currently at the level of the beginning of 2016. In view of the positive fundamental data and the broader real interest rates in emerging markets compared to developed markets, Rutz expects the level to rise again and that the US dollar will not strengthen further. 

Emerging markets constitute the most diversified bond markets today 
More than 150 individual markets are already included in the four most important EM benchmark indices for fixed-interest securities, and there is still a great deal of upward potential. In comparison, there are a maximum of 144 individual markets in the developed countries. In other words, Emerging Markets are already the most diverse fixed income asset class in the world. "Diversification will continue to increase in the future. And the growth potential is also much faster than in developed countries. With the necessary expert knowledge, investors can find attractive investment opportunities here," says Rutz. 


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  Fonds Professionell Kongress 2019

Meet us at the renowned investment congress where you can meet investment professionals in person and listen to interesting speeches.

Adrian Daniel will speak about:

Structural Growth - The World in 2025
30 January 2019, at 14.55h
Hall 7

The MainFirst fund manager will explain how investors can benefit from such structural growth themes drawing on the experience of the past six years, in which the team has used megatrends to outperform global equity markets to generate attractive returns for their clients. Find out what developments are likely to take place by 2025.

Also, visit us at our booth 216 where we will be happy to inform you about our products. 

Date and location:
30 and 31 January 2019
Congress Center am Rosengarten, Mannheim

  Facts in favour of Indonesia

Frankfurt am Main 26 November 2018 Since the Asian crisis of 1997/1998, investor confidence in Indonesia has been dampened. "However, the general sell-off recently lacked any factual basis," says Thomas Rutz, fund manager of the MainFirst Emerging Markets Corporate Bond Fund Balanced. "Investors are guided by their fears and not by the continued robust fundamentals. In fact, since 2010, the Indonesian economy has enjoyed considerable and continuous growth of around 5 percent per year, which makes it the G20 country with the most stable economic development. Inflation has been fairly stable since 2016, usually at around or below 4 percent. The main reason for this is a strong export business with commodities such as coal, whose prices increased by 6.6 percent in 2018 alone. In the last five years, 15 percent of coal exports went to China, which makes Indonesia one of the largest coal suppliers to a country that continues to use it as its primary energy source. “The coal market is currently under a healthy supply-demand regime and coal prices have recovered significantly since the supply-side reform introduced by the Chinese government in late 2016”, explains Rutz.  

Interesting relative value opportunities
Coal will continue to be one of the most important sources of energy for China and the emerging markets in the future. So demand is secured for decades to come. Despite this positive industry outlook and improved fundamentals, Indonesian coal mining companies such as ABM Investama & Geo Energy have suffered significantly in recent months. Not least for this reason, Rutz sees considerable potential for investors here: “Since exports of both companies are usually traded in US dollars, they have minimal currency exposure and volatility in the Indonesian Rupiah (IDR) does not affect the companies negatively, but can even have a positive effect on their profit margins as they are actually rising through lower operating costs (which are paid in IDR).” Both companies demonstrate solid performance with increasing EBITDA figures and moderate leverage. “Given the industry outlook and fundamentals of the two companies we expect them to trade 80-100 basis points tighter vs. their peers,” adds Thomas Rutz.

Potential for continued growth
The Indonesian economy performed well in the third quarter and is forecasted to continue to grow by a good 5 percent over the next few years. The foreign debt is low and the national debt amounts to only about 29 percent of the gross domestic product (GDP). “With currency reserves of between 115 and 120 billion US dollars, Indonesia is more than well positioned,” the fund manager says. In addition, president Widodo plans to support growth further through government spending, increasing it by 10 percent in 2019. “Recently, quasi-sovereign bonds such as IDASAL (Indonesia Asahan Alumini) have become very attractive and we expect more opportunities to emerge. In the course of just one week, its credit spread vs US Treasuries has already narrowed by 64 basis points to 299,” explains Thomas Rutz. Fixed investment, supported by higher commodity prices and government consumption, is likely to receive a boost ahead of elections in April next year. At the same time, the additional spending should help to underpin domestic demand. "In the longer term, rising incomes and steady growth of the middle class and population will also contribute to this," says Rutz, giving a positive outlook of the future. 


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  How can investors avoid the demographic trap?

Frankfurt am Main, 19 November 2018 Demographic change does not only affect pension debates in Europe. Economists are also warning of the effects of population decline, which are likely to have an impact on economic growth. Not only in Germany, but throughout Europe the average age of the population is rising steadily. According to studies, around 30 percent of people in the euro zone will be older than 65 in 2070. By comparison, in 2016 the figure was still 20 percent. "Demographic change in developed countries will have an economic impact," says Adrian Daniel, fund manager of the MainFirst Absolute Return Multi Asset, warning against a slowdown in economic growth. At the same time, however, he sees opportunities in industries that are growing particularly fast as a result of such structural changes. "Structural trends, including demographic change, offer interesting investment opportunities," says the fund manager, citing developments in healthcare and automation as examples. 

Effects of demographic change 
Falling numbers of workers in relation to pensioners will lead to a decline in labour force and employment and thus to lower productivity. One example of the consequences of an ageing population is Japan, where senior citizens already make up 27 percent of the population. "The historical development in Japan shows that an ageing population leads to a decline in consumption. In contrast to young families, the older generation has settled and does not foster growth trends," explains Daniel. A further complicating factor is that the low willingness to consume leads to price pressure among competitors and thus to deflation. "Mature consumers are less willing to make new purchases if they can assume that they will be even cheaper in the future". According to the fund manager, conditions in Japan can be taken as a blueprint for the euro zone and Germany is considered as being most affected by the loss in population.  "For the younger generation, the challenge of creating growth is becoming increasingly difficult," says the fund manager. 

New growth markets offer opportunities for investors 
But demographic change also offers opportunities from a microeconomic point of view. Genetic medicine is already advanced and will in the long term enable the development of tailor-made, targeted medication and thus reduce treatment costs. Thus, healthcare companies have interesting opportunities to position themselves. The nursing sector is also a growth sector. "Companies can benefit from demographic change if they deal with the needs of older people". In this context, automation is also an interesting topic, even though - except in Japan - there are still great reservations about "robo caregivers". At the same time, this sector is promising for the future wherever traditional workers can be replaced. In China, for example, there is an increasing shortage of migrant workers, and automation should now help to counter the shortage of labour.

Structural growth trends enable long-term return prospects 
"Investors can take advantage of structural growth trends, as they can be forecast well in advance and are long-term. This means greater security for investors," explains Daniel. This is shown by history where sectors have alwayas dominated for an average of 50 to 70 years. "However, in order to take advantage of this growth, we need comprehensive expertise and an analysis-based forecast," says the fund manager. "In this way, returns can be generated with an attractive risk/return profile despite demographic changes."


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  Interview with Thomas Rutz: Move early to achieve higher returns for investors

In his interview with Citywire, Thomas Rutz explains, why he likes to buy in early: “You can get a huge valuation gap and you can pick up really cheap stories.” Find out more about the strategy he and his colleagues use to generate an attractive performance in the MainFirst Emerging Markets Corporate Bond Fund Balanced. 

Read the interview (p. 22f)

  Interview with Adrian Daniel on the Advantages of Investing in Structural Trends

In an interview with Citywire, Adrian Daniel explains why structural growth trends are good investment themes: Long-term trends are gaining ground and bring sustainable returns while short-term market volatility recedes into the background.

  Video: Investing successfully in value-oriented equities from the eurozone - 5 questions to Thomas Meier

Find out which four strategies Thomas Meier, Head of Equity Fund Management, combines in the MainFirst - Euro Value Stars in order to successfully use value investing to achieve attractive returns for you as an investor, also in 2019.

  Technological innovators see accelerating growth

Frankfurt am Main, 08 November 2018 – The latest setback in technology stocks could offer attractive buying opportunities for investors wishing to benefit from structural growth trends. Frank Schwarz, portfolio manager of the MainFirst Global Equities Fund, holds after the MSCI World Information Technology Index fell by around twelve percentage points in October. He sees it as a temporary correction based on investor sentiment and profit taking in the current reporting season. However, with an average organic revenue growth of 28 percent for his portfolio companies in the current season, the most important indicator remains intact. Schwarz anticipates rising profit margins in the long term and double-digit growth rates for technological innovators - including for companies other than Facebook, Amazon and Alphabet (Google).

"Increasing computing power combined with falling production costs continues to be the biggest growth driver for technological innovations," says Schwarz. For example, smartphones today do not only have more memory capacity than a classic desktop computer 15 years ago. Every single byte of memory is also produced more cheaply: For example, the production of one gigabyte of storage space in 1957 cost around two million US dollars, but today its price is only 0.02 US dollars. "The same development can also be seen in current innovations such as batteries for electric cars or 3D printing, which are only at the beginning of their development and use," reports the fund manager. For example, the production costs of electric car batteries have fallen six-fold in the past twelve years, and the costs of 3D printing have even fallen by a factor of 400 within just seven years.

Information technology as growth accelerator
Technological change is not just progressing, it is accelerating. In information science, this is explained, for example, by Moore's Law. It states that computing power doubles every two years, which is attributed to the doubling of transistors in an integrated circuit. Only the boundaries of physics limit this growth. According to Ray Kurzweil, one of the heads of engineering at Google, new technologies make it possible to overcome these physical limits. He postulates in his Law of Accelerating Returns that computing power begins to double every year once information technology is the driving force behind innovation.[1] 

"Not only end-users benefit from the ever faster technological progress. The winners are also companies that satisfy the growing demand for data in technological trends and thus make progress possible," says Schwarz. For example, Nvidia, which is one of the largest developers of graphics technologies and chipsets, recently posted record growth. In the second quarter of 2018, the data center segment alone recorded growth of 83 percent. Also in the long term, Nvidia is one of the innovators with its latest developments: "The latest Nvidia graphics card is six times as powerful as its predecessor. With completely new technologies, it offers applications beyond the entertainment industry," says Schwarz. Nvidia now also serves sales markets such as artificial intelligence, autonomous driving and medical diagnostics: "The graphics card can be used in biophotonics for cancer detection, for example," says Schwarz. 

Just as smartphones and big data are driving economic growth today, structural growth trends such as automation, artificial intelligence and e-mobility are likely to shape the economy in future. Schwarz, therefore, sees accordingly positioned innovative companies as sources of attractive returns, despite temporary volatility, which should deliver high growth rates in the long term.

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  MainFirst Bank AG to combine with Stifel Europe

- MainFirst Bank AG is widely recognized for excellence in equity research and equity brokerage
- The combination creates a Pan-European platform with deep local expertise and distribution power
- MainFirst Asset Management to remain independent 

Frankfurt/Main, 06 November 2018 – MainFirst Holding AG today announced that it has agreed to combine the Investment Banking Equities of Mainfirst with Stifel Europe, a leading full-service middle-market investment bank based in London that is a wholly owned subsidiary of Stifel Financial Corp. (NYSE: SF). As a consequence, Stifel Europe acquires MainFirst Bank AG, MainFirst Schweiz AG and MainFirst Securities US Inc. Terms of the transaction were not disclosed. Closing is expected in the first quarter of 2019, pending regulatory approvals. Senior leadership from MainFirst has executed continuation agreements. The acquisition does not affect MainFirst Asset Management. In order to underline its independence, MainFirst Asset Management was split off from MainFirst Bank AG this year and now operates under its new independent corporate structure as MainFirst Affiliated Fund Managers (Germany) GmbH.

MainFirst is widely recognized for excellence in equity research, ranking as the number one provider of country research in both Germany and Switzerland, according to the 2018 Extel Survey. Coupled with Stifel’s existing strength in the U.K. market, the merger creates a Pan-European platform with deep local expertise and distribution power throughout the continent’s major markets. MainFirst carries a full German banking license, enabling Stifel to continue offering corporate advisory, brokerage and investment banking services and clear and settle secondary equity and fixed income trades post-Brexit.

MainFirst also adds significant capital raising capabilities to Stifel’s already robust equity issuance business. Through the first three quarters of 2018, Stifel ranked as the fourth largest fundraiser on the London Stock Exchange, based on both volume (25) and value (1.8 billion pounds) of deals. MainFirst is increasingly focused on syndicate roles, leveraging the firm’s core expertise in research and distribution.

“We are excited to join Stifel, and work with our new colleagues,” commented Ebrahim Attarzadeh, CEO and Head of Equities of MainFirst. “Combined, we will be more relevant to clients in both our brokerage and investment banking businesses.”

“We are extremely pleased to partner with MainFirst, as we continue to make opportunistic investments in our business,” said Eithne O’Leary, President of Stifel Europe. “Given the evolving European regulatory environment and changing market dynamics, we will continue to pursue strategies that enable us to best serve current and future clients with a wider range of products.


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  After the run off in Brazil – what lies ahead?

Frankfurt am Main, 25 October 2018 A victory for the favourite Jair Bolsonaro of the Social Liberal Party (PSL) in the run-off elections in Brazil should give Brazilian real and assets values a boost. Thomas Rutz, fund manager of MainFirst Emerging Markets Corporate Bond Fund Balanced, expects a recovery of the Brazilian Real and a narrowing of credit spreads for Brazilian government bonds for this scenario. "We see positive indicators pointing to a sustained economic upturn in Brazil," said Rutz. Recent surveys, such as those conducted by the Brazilian Institute of Public Opinion and Statistics, predict that Bolsonaro will win the runoff elections on 28 October against Fernando Haddad of the Workers' Party (PT).

Upswing in GPD growth and business cycle likely
A first upswing in the markets had already become apparent shortly before the elections and was further confirmed after Bolsonaro barely missed the majority with 46 percent of the votes in the first round of elections at the beginning of October and his PSL became the second largest party in parliament. Since then, the Brazilian Real (BRL) has already recovered against the US Dollar (USD) from 4.2000 at the beginning of September to 3.7000 by mid-October, while Brazil's credit spread (JP Morgan CEMBI Z-Spread to Worst) has narrowed by around 70 basis points from 430 to 360. Rutz assumes that the USD/BRL range will remain similarly tight until the end of the year. Brazilian assets have also repriced quickly - correcting the overshooting of recent months. "We are likely to experience some further repricing as many shorts are now squared and real money folows might return," adds Rutz. 

The Emerging Market expert also sees further potential in the economic cycle. "The Brazilian economy has corrected sharply in recent years, inflation is low, the currency is cheap and external balances are healthy. Brazil is therefore ripe for a long and sustained upswing in the business cycle, which could could support Brazilian markets long after the turmoil surrounding the election will have passed," the fund manager emphasizes. Brazil's GDP growth is expected to accelerate in the third quarter to 1.8 percent year-on-year and to around 1 percent quarter-on-quarter. The current forecast for 2018 assumes a growth in gross domestic product (GDP) of around 1.5 percent. The forecast for 2019 is even more positive, expecting GDP growth to exceed 3 percent.

Bolsonaro’s expected win strengthens positive market sentiment 
The markets are particularly in favour of Bolsonaro, because if he wins, he is likely to live up to his nickname “Trumpinho” (little Trump) and form strong alliances with business and create economic liberty. At the same time, he will take measures against corruption and even more so against crime. He has a strong economic team led by Paulo Guedes, a renowned economist, who advocates pension reform and the privatization of state-owned enterprises. Rutz adds: “The stronger than expected performance by Bolsonaro’s allies, and the right generally, in the congressional election on 7 October means that pension reform and other changes should be within reach.” This is particulary important as the pension reform is by far the most pressing issue in Brazil from an investor perspective due to the massive fiscal cost of the deficit in the public system (about 3% of GDP per year). The topic is therefore sure to retake centre stage when the the election is over. “Bolsonaro has the good fortune of inheriting an economy that is enjoying a cyclical upturn and a reform initiative to social security that is far enough advanced that it should be hard to reverse,” highlights Rutz.  

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  Video: Mainfirst Global Equities Fund - a day with the fund management


Do you want to invest in long-term, theme-based global shares, with tactical hedging? If so, the MainFirst Global Equities Fund may be exactly the right investment fund for you, as it is managed by a highly experienced fund management team.

  Investment into global megatrends unconstrained: the MainFirst Global Equities Unconstrained Fund

Frankfurt am Main, 17 October 2018 MainFirst expands its range of funds to include another global equity fund, the MainFirst Global Equities Unconstrained Fund. Its investment strategy is the same as that of the successful MainFirst Global Equities Fund with the difference that the new fund does not use an overlay based on technical indicators. Lead fund manager Frank Schwarz explains: "In response to multiple client requests, we have decided to offer the fund without tactical hedging. 

Its theme-based approach focuses on structurally growing investment themes such as digitization, automation and decarbonization. The investment strategy is long-term, with an investment horizon of over five years. "This allows the fund to benefit strategically from the longer-term performance of the companies and to free itself from short-term fluctuations," clarifies Frank Schwarz.

The fund operates independently of its benchmark, the MSCI World Index EUR Index, and has a high active share. The fund is generally 100 percent invested and operates without tactical hedging. All stocks are carefully selected and continuously analysed with a focus on growth stocks. "Finding fast but organically growing companies that are at the forefront of structural megatrends is at the centre of our approach," explains Frank Schwarz. The team, consisting of Frank Schwarz, Patrick Vogel, Jan-Christoph Herbst, Adrian Daniel and Johannes Schweinebraden, has many years of investment experience and the track record of the five-year old MainFirst Global Equities Fund gives an indication of the potential of the investment strategy.

  MainFirst acquires European Equities institutional brokerage business from Raymond James

Frankfurt/Main, 09 October 2018 - MainFirst Bank AG, a leading independent European equity research and trading firm, will acquire the institutional brokerage business in European equities from Raymond James in Paris and London effective December 1, 2018. As part of this acquisition, MainFirst will also add 29 employees from Raymond James in Paris including Research, Sales and Sales Trading and a further six Research employees in London. These individuals will be integrated into the MainFirst organisation. The acquisition will strengthen MainFirst's strategic position, particularly in France.

"With this step, we will achieve economies of scale, better leverage our competitive advantages in the new world of MiFiD II and an expanded platform to serve our clients," said Ebrahim Attarzadeh, CEO and Head of Equities at MainFirst Bank AG. As a result of the acquisition, the number of European shares covered by MainFirst sees a rise by approximately a quarter to 400, with the number of MainFirst's institutional clients in France also increasing significantly.

  Presidential elections in Brazil: immediate risks for financial markets largely priced in

Frankfurt am Main, 5 October 2018 - Around 145 million Brazilians will be voting for their new president next Sunday and on 24 October in the general elections. "The country needs drastic, unpopular economic reforms to reduce the bloated government, counter the high budget deficit and reduce rising social security spending," says Thomas Rutz, fund manager of the MainFirst Emerging Markets Corporate Bond Fund Balanced. However, the expert sees the widening of the spread of the credit default swap (CDS) in Brazil and the correction of the Brazilian equity market as a sign that the financial markets have already priced in the risks associated with the outcome of the presidential elections and should remain stable for the time being after next Sunday. In the medium term, however, investors would take a very close look at whether the next elected president is pursuing a credible and reform-friendly economic program. "If this is not the case, a worsening of the situation will have to be expected," said Rutz.

Two candidates currently stand a good chance of taking office: Jair Bolsonaro, a former military leader and member of parliament, who belongs to the right-wing populist Partido Social Liberal (PSL), and Fernando Haddad, the former mayor of Sao Paulo, who will run for the left-wing Workers' Party (PT). Haddad was nominated as a candidate for the PT at short notice after the popular ex-president Luiz Inácio Lula da Silva had resigned because of his conviction in a corruption trial. "A run-off among these two candidates already seems almost certain," says Rutz. Geraldo Alckmin, the favorite of investors and candidate of the middle class, by contrast, "practically does not stand a chance".

The financial markets are following the election campaign closely. After a severe recession in 2015 and 2016, Brazil has recently experienced a slight upswing. "But the effects are not yet really felt by the population," explains Rutz. In the past four years, the budget deficit amounted to more than seven percent of gross domestic product (GDP). According to the expert, high social security contributions and rising pension expenditure are preventing urgently needed investments in the country's physical and social infrastructure.

Frustration about unemployment, corruption and crime among the population is correspondingly high. "Bolsonaro exploits this for populist slogans," says Rutz. The former captain of the army promises to crack down on crime, fight corruption and restore economic growth. His presumed future finance minister, Paulo Guedes, is liberal, wants to cut spending and buy back debt with income from privatizations of profitable state-owned enterprises and the public pension system. "For many hope that he will implement the necessary reforms makes him the favorite of the two front runners.

Lula's candidate Haddad has worked his way up to second place since his nomination on 11 September. He promises to reverse many of the unpopular (but necessary) reforms of the highly disliked President Michel Temer to cut social spending. Temer had moved to the head of state in 2016 after the dismissal of President Dilma Rousseff. "Instead of pushing ahead with privatisation and pension reform, Haddad wants to boost the economy through investment. The markets hope that, like Antonio Manuel Lopez Obrador in Mexico, he will not implement his more drastic ideas for reform," says Rutz.

  The MainFirst Classic Stock Fund is renamed MainFirst Euro Value Stars

MainFirst’s fund with the longest track record is getting a new name to better reflect its investment approach. Its new name (as of 15 September 2018) is: 

MainFirst Euro Value Stars

‘Euro’ reflects the focus on the Eurozone as its investment universe

‘Value’ stands for the investment into value titles

‘Stars’ highlights the search for promising companies with high price growth potential

Within the general approach of value investing, the fund managers, Thomas Meier and Christos Sitounsis, employ an unusual method using four different value strategies to achieve attractive performance for clients. The four strategies are:

-       Classic Value Investing

-       Deep Value

-       Contrarian

-       Events

The fund combines the four strategies in order to achieve an attractive performance over all market phases. In the fundamental analysis of titles both quantitative and qualitative factors such as promising earnings growth potential, solid cash flow and high-quality business models are taken into account. Since its inception in 2002, the fund has built a solid track record and outperformed its benchmark.

Find out more about the MainFirst Euro Value Stars

  If Technological Progress Accelerates Exponentially – Which Companies Are the Winners?

No one doubts today that attractive returns can be achieved with big tech companies such as Alphabet, Amazon or Apple. They are growing fast – sometimes at seemingly exponential rates. But will this continue? And which companies are benefitting from the progress made?

  Favourable Fundamentals for Attractive Returns in Emerging Markets

EM fundamentals are intact and dedicated experts can profit from attractive buying opportunities says Thomas Rutz, EM fund manager at MainFirst.

Emerging Market fundamentals are much more resilient than they used to be. Although uncertainty over trade tariffs, a strengthening dollar and Trump’s Twitter tirades recently led to market corrections, compared to the time of the taper tantrum Emerging Markets are much less vulnerable to such factors as the macro economic backdrop and credit fundamentals remain constructive. 

Read the full article here. 

  Video: Sustainable Dividends with an Attractive Performance

“We have not only reached our targets, but exceeded them.” This is the positive interim conclusion drawn by Thomas Meier, Head of Equity Fund Management at MainFirst and Portfolio Manager of the MainFirst Global Dividend Stars. Find out more about the attractive results achieved and the investment strategy in the video. 

  Small Caps can Generate High-Quality Dividends - the MainFirst Global Dividend Stars Provides Higher Yields than Comparable Products

This is the conclusion Euro fondsxpress reaches in its interview with Thomas Meier, Head of  Equity Fund Management, where they talk about the strategy of the MainFirst Global Dividend Stars. Meier capitalises on selected small caps with sustainable dividend yields.

  What do a scale and the MainFirst Global Dividend Stars have in common?

Both keep an ideal balance for attractive outcomes.

To generate attractive outcomes for investors, the MainFirst Global Dividend Stars uses the Barbell strategy for a balanced portfolio, and focuses on high quality and sustainability of dividend yields. The fund does not follow a benchmark, and invests globally in companies selected on the basis of an in-depth process of analysis. This is what made it the best fund in its category at the end of 2017 (Morningstar ranked it first of 489 funds in the category Global Equity Income, denominated in EUR. As at 12/31/2017).

The Barbell strategy for a balanced investment approach 
The central approach used for the dividend fund is the Barbell strategy, whereby established large caps are blended with small and mid caps (currently 46%) in such a way as to obtain a balanced, attractive risk/return profile for investors.
The two types of investment that create an attractive balance in the MainFirst Global Dividend Stars are: on the one hand, defensive, solid, relatively non-cyclical companies with a high market capitalisation, such as consumer goods manufacturers and insurance companies that bring stability to the portfolio. On the other hand, this is balanced by smaller companies which offer opportunities to generate high returns and dividends. The latter tend to be family-run international niche market leaders (INML), characteristically with a leading market position, great growth potential, strong balance sheets and profitability as well as high quality of the management.

Dividends 2.0 for constant, attractive returns 
At the same time, the stock picking process is focused on high quality dividends, so the returns are as attractive and sustainable as possible. These can be found in companies using robust business models. The selection process, which spans different regions and sectors, includes a detailed, bottom-up analysis of the companies. As well as the quality of dividends, emphasis is placed on criteria such as balance sheet strength, structural profitability, substance and growth potential.

Strong companies for good performance 
Companies that meet these criteria include – on the defensive front – Tiffany and Occidental, and – on the INML front – Sixt, Sika and Washtec.
Tiffany is a world-famous American jeweller established over 180 years ago. Time and again over the years, the company’s innovative ideas have been a talking point and it has successfully overcome challenges and steadily evolved. Since Alessandro Bogliolo was appointed CEO in October 2017, the sales figures have soared. The first quarter of 2018 saw net sales leap 15%, due not least to the company’s success in China and Japan. Overall, quarterly profits rose 53% year-on-year, thanks also to the positive effects of President Trump’s tax reform.
One international niche market leader is Sixt. For years, the mobility firm’s strong growth has been in the headlines time and again. In 2017, group net profit was EUR 204 million, which corresponds to growth of 31% over the previous year. Another international niche market leader is the company Washtec, which provides integrated and service solutions in the carwash industry. The company’s turnover grew by 14% in 2017.
Another good example of an INML is Sika, which is headquartered in Switzerland but operates worldwide as a specialist in the manufacture of various chemical products for industrial bonding, sealing and reinforcing. In 2017, the company grew by 9% and consolidated profit grew by more than 14%. Sika’s main priority is growth through R&D to achieve an annual growth of 6% to 8% between now and 2020.

Attractive outcomes 
This strategy has enabled the fund managers of the MainFirst Global Dividend Stars, Thomas Meier and Christos Sitounsis, to achieve a total performance of 21.8% since its inception almost three years ago. This represents an outperformance of 7.5% versus the MSCI World High Dividend Yield Net Return (as at: 05/31/2018, ISIN LU1238901596). The twice-yearly dividend distributions have been 3.5% on average since its inception.

  The dilemma for savers in the eurozone – why structural trends are more important than economic cycles

Frankfurt am Main, 11 June 2018 – European savers will have to adjust their investment behaviour in order to generate positive medium-term returns. This is the view of Adrian Daniel, fund manager of MAINFIRST - ABSOLUTE RETURN MULTI ASSET, launched five years ago. Growth momentum in the eurozone is slowing and the low interest rate environment will continue. “A look at leading indicators suggests it is not advisable to rely purely on the positive economic situation at the moment”, according to the fund manager. He advises investors to invest on a more global basis and generally to focus their portfolios to a greater extent on long-term structural trends rather than economic cycles.

European equity markets have showed gains overall recently, but in global terms have been significant relative underperformers. As an example, excluding currency factors, the MSCI EMU Index (European Economic and Monetary Union) generated 50 percent lower returns than the MSCI USA over the last six years. So it would already have paid off to take a more global approach in the past. But in the future this is likely to be even more important, as leading indicators appear to have hit temporary highs at the start of the year indicating a potential slowdown in growth momentum in the eurozone. As an example, the ifo Business Climate Index was at a long-term high of around 105.2 points in November, and has since fallen. “The DAX is currently enjoying its longest upswing of the post-war era, and at the same time we remain in a low interest rate environment”, according to Daniel. Against this backdrop, the challenge for eurozone savers is to find other sources of return.

For it is highly likely according to Daniel that the ECB will miss the window for interest rate hikes – although after a planned changeover in mid-2019 the European Central Bank will have to start by taking stock. And should the economic upturn in the US falter and the Federal Reserve end its policy of normalising interest rates, it is questionable whether the ECB will be able to raise rates. The opportunities for returns in fixed-income investments should remain relatively low, while the trend in European equity markets seems to have run a long way.

The only solution to this tricky situation is to permanently expand one’s investment horizons, according to Daniel, who is banking on a mixture of bonds and equities. He believes in selecting securities for the long term and, most importantly, concentrating on investment themes with structural growth. “Structural trends are significantly more important for us than economic cycles. Their influence on portfolio performance is much longer lasting”, explains Daniel, whose fund follows an absolute return strategy independent of any benchmark.

For example, Daniel is currently backing groups generating major parts of their earnings with e-commerce, such as Amazon and Alibaba. Other investment themes are mobile internet, Industry 4.0 and global brands. The team uses both technical indicators and bottom-up and top-down fundamental research as the basis for stock selection and allocation decisions in the fund. With an annualised return of 5.5 percent since its launch on 29 April 2013, MAINFIRST - ABSOLUTE RETURN MULTI ASSET has exceeded its targeted long-term return of 5% p.a. (as at 30 April 2018, ISIN LU0864714935). 


Download the press release

  MainFirst awarded Best Equity Research for German and Swiss equities

Frankfurt am Main, 6 June 2018 – MainFirst Bank AG has won Best Research for German and Swiss equities in the Extel Survey 2018, Europe's foremost evaluation of the best brokers in research and trading. MainFirst thus maintained its top ranking for Switzerland, and climbed from second to first place for research in Germany.

Every year, a top quality body of sector specialists at Extel Survey evaluates areas including the services of research providers, using the results of a broad-based investor survey. Some 7,000 institutional investors participate in the survey annually. “The fact that we have been named best research provider for equities in Germany and Switzerland serves to underscore our strategy. The experience of our research team, the independence of our around 40 analysts and their excellent contact network to companies enable us to provide high quality research that offers real added value for investors. We focus primarily on German, Swiss, French and Italian equities and several European sectors,” said Lyonel Françoy, Head of European Research at MainFirst. “We plan to expand our coverage of French and Italian equities in addition to our broad scope of German and Swiss securities.”

“The results of this year's survey underpin our success as one of the leading equity research and trading providers. We have recently significantly increased our market share in the area of equities,” said Ebrahim Attarzadeh, Head of Equities and member of the Board of Management at MainFirst Bank AG. “The award for best research in German and Swiss equities is particularly representative in the new world of MiFID 2, where customers are only willing to pay for differentiated, high quality and independent equity research. The award is more than just an acknowledgement, it is also an incentive. Our objective is, and will remain, to offer our clients top class research and efficient execution,” said Attarzadeh.

  Three measures for a successful multi asset portfolio - Adrian Daniel speaks to Citywire

In the past three years, the MainFirst Absolute Return Multi Asset (A) has shown a cumulative performance of 12.9 percent (as at 31 May 2018, ISIN LU086471400). According to its lead portfolio manager Adrian Daniel, one important factor for this success is the focus on structural growth trends.

  Economic cycles or structural trends - Adrian Daniel explains their significance in Boersen-Zeitung

Many investors see economic cycles as important indicators for the equity ratio in their portfolio. However, with this approach investors risk being constantly late and missing the trend. Usually, economic growth has long been priced in, explains Adrian Daniel. Other factors are more indicative…

Find out more in the article (German only)

*MainFirst Absolute Return Multi Asset C, as at: 30.04.2018




The MainFirst Absolute Return Multi Asset, managed by Adrian Daniel, is committed to a long-term investment strategy with the aim of achieving a return of at least 5 percent per annum. He has exceeded this target since the fund's inception 5 years ago (29.04.2013) (as at 30.04.2018, share class C, ISIN LU0864714935). Watch the video to find out why Adrian counts on structural trends.

  Generating attractive returns through long-term trends

Investors are constantly faced with major challenges. With interest rates persistently low, and no prospect of them being raised to their earlier levels in the next few years, they are seeking alternatives. One such alternative is multi-asset funds with a sound investment strategy. MainFirst Absolute Return Multi Asset, headed by Adrian Daniel, has a long-term investment strategy which aims to generate a return of at least 5% while keeping volatility within a reasonable level. The strategy has proven successful thus far, with an annualised performance of 5.68% and average volatility of 5.1% since the fund’s launch on 30 April 2013 (as at 29/03/2018, unit class C, ISIN LU0864714935).

Adrian Daniel and his team follow an investment approach that focuses on long-term, structural trends such as digitalisation and automation. Besides offering high growth potential, such structural trends carry more weight than macroeconomic cycles. The more technology advances, the greater its influence will be on the standard macroeconomic data that is used by the capital markets to shape their investment strategies. By carrying out detailed analyses, the team is able to tap into new trends early and generate particularly attractive returns.

Digitalisation has led to profound changes in many areas of business. Amazon has built a huge e-commerce empire and entirely changed the future of the retail industry in the process. Google and Facebook’s social and news networks have transformed the way we share information. This has also led to major changes on the capital markets, where many digital companies (such as Apple or Alphabet) now have the highest market capitalisations.

Automation is also continuously advancing innovative disruptions. This is affecting the wage-price structure; while low-skilled workers are earning less, skilled workers’ wages are going up. At the same time, companies are generating higher revenues thanks to increased automation. As higher productivity combined with lower costs can lead to higher earnings or provide an opportunity to expand into new business areas. Innovative business segments offer strong long-term growth. The fund’s investments in companies driving structural trends have significantly contributed to its performance in the equity component over the past few years.

But it is also worth taking a long-term approach to bonds by analysing issuer business models in terms of structural changes and disruptive technologies. For example, Toys R Us was still a leader on the credit market at the turn of the millennium, but was recently forced to declare bankruptcy due to competition from online retail. These are the kinds of risks that should be identified before they materialise. In addition to this far-sighted approach, general trends on the interest rate markets such as low core inflation are also taken into account, despite indications that the ECB’s bond-buying programme is to end in the near future. While duration in the fund was extended to 4.8 years at the start of 2018 due to attractive return opportunities, it has now been brought below 4 years again. In total, the portfolio comprises around 30% corporate bonds and 20% government bonds in order to optimise the risk/return profile of the bond component.

This combination of a flexible approach with a focus on long-term structural trends offers an attractive opportunity for investors in Europe. This is because in addition to demographic changes, digitalisation and automation are key reasons for the low core inflation in the eurozone. In light of the low interest rate environment, MainFirst Absolute Return Multi Asset, which invests worldwide, therefore offers an attractive source of income for risk-conscious investors.



  4 MainFirst funds receive Lipper Fund Awards

MainFirst was presented with multiple honours at this year’s Lipper Fund Awards.

For more than three decades the Lipper Fund Awards have been awared across more than 20 countries to investment companies and funds that have excelled at delivering consistently strong risk-adjusted performance relative to their peer group.

Honored multiple times, the MainFirst – Emerging Markets Corporate Bond Fund Balanced (ISIN: LU0816909955) managed by our AAA-rated (Citywire) fund managers Cornel Bruhin, Dorothea Fröhlich and Thomas Rutz, took home awards in the Bond Emerging Markets Global Corporates 5-year category in seven different regions (Europe, Germany, France, the Netherlands, Scandinavia, Switzerland and the UK), as well as the award in the 3-year category in Scandinavia. The MainFirst – Emerging Markets Credit Opportunities Fund (LU1061983901), managed by the same team, received the award for the Netherlands in the Bond Emerging Markets Global HC 3-year category. 

Managed by Olgerd Eichler, Evy Bellet and Alexander Dominicus the MainFirst – Germany Fund (LU0390221256) received – in addition to such other accolades as the Euro Fund Award and the Deutscher Fondspreis,  the Lipper Fund Award for the third year in a row in the Equity German Sm & Mid Cap 5-year category in Germany. 

The MainFirst – Absolute Return Multi Asset (LU0864714000) managed by Adrian Daniel, Frank Schwarz, Patrick Vogel and Jan-Christoph Herbst won in the Absolute Return EUR High 3-year category in Switzerland. Adrian Daniel and Patrick Vogel also received Citywire’s Best Fund Manager 2017 Italy award (Mixed Assets - Absolute Return). 

Recipients of a Lipper Fund Award, presented by Thomson Reuters, are investment funds which are evaluated each year on the basis of their historical performances of the past 36 months or more. The funds showing the best risk-adjusted performances in their category over 3, 5 and 10 years are honored with a Lipper Fund Award. 

  The most valuable companies now vs. 2025 - Frank Schwarz talks to Focus Money

Currently, Apple, Alphabet and Microsoft top the list of the largest companies. In 2025, according to Frank Schwarz, it will be two Chinese companies: Alibaba and Tencent. The fund manager of the MainFirst Global Equities Fund explains why this will be the case in Focus Money.

Read the article (German only)

  New Management Board member at MainFirst Bank AG

Frankfurt/Main, 22 March 2018 – A new member will join the Management Board of MainFirst Bank AG: The Supervisory Board has appointed Ebrahim Attarzadeh as a member of the Management Board of MainFirst Bank AG with effect from 1 April 2018. Together with Management Board member Bjoern Kirchner he will form a dual leadership team for MainFirst Bank AG from 1 May 2018. As announced in July 2017 already, current CEO Andreas Haindl will be leaving the company at his own request when his contract expires on 30 April 2018.

Ebrahim Attarzadeh has been with MainFirst since 2006. He started in Sales Trading and took over the management of this unit in 2008. Since 2011, he has been in charge of the Equities division. Attarzadeh began his career in 2002 at Deutsche Bank in Frankfurt. Bjoern Kirchner has been a member of the Management Board since 2007. From 2003 to 2007, he headed Equity Research. Since then, he has acted as Chief Financial Officer of MainFirst Bank AG.

At a General Meeting of MainFirst Bank AG Marc-Antoine Bree was elected as a new member of the Supervisory Board.

Marc-Antoine Bree, Chairman of the Supervisory Board, comments: “With the appointment of Ebrahim Attarzadeh to the Management Board of MainFirst Bank AG we have implemented an internal solution as intended and have achieved the desired management continuity with a competent personality. Regarding the departure in April 2018 of our long-standing CEO Andreas Haindl, we have found a perfect succession solution with Ebrahim Attarzadeh and Bjoern Kirchner forming a dual leadership team. This will facilitate the continued enhancement of the successful positioning of the Bank over the coming years.

The Supervisory Board would like to thank Andreas Haindl for his outstanding work and achievements in the build-up and development of MainFirst Bank AG, where he has made a decisive contribution since 2006. The committees and staff will stay connected with him and wish him every success for future endeavours.”


Download the press release

  Winners and losers: These are the world’s biggest companies in 2025

Frankfurt am Main, 12 March 2018 – By 2025, things are set to change in the list of the world’s biggest companies. A current forecast by MainFirst Asset Management shows that while Apple, Alphabet and Microsoft currently have the highest market capitalisation, Alibaba, Tencent and Amazon look like they will be leading the rankings by 2025. “In the years ahead, they will benefit from the future themes of e-commerce, artificial intelligence, digital advertising and driverless cars," explains Frank Schwarz, who led the analysis. Through the MainFirst – Global Equities Fund, which he manages, Schwarz has been successfully investing for five years in listed companies that benefit from these trends. In 2017, the fund recorded growth of 39 percent, and growth of 125 percent since inception.[1] “The projected shifts in the period to 2020 are already priced into share prices, so we are looking ahead to identify the best investment opportunities,” says the fund manager, whose team monitors a universe of around 700 global companies.

German brain-drain 
What is striking is that the regional shift towards Asia is set to increase in the period to 2025. “Among the 20 most important companies, most will have their headquarters in China, South Korea or Taiwan. Only the West Coast of the US, centred around Silicon Valley, will be able to compete. In contrast, Europe will be totally disconnected – and any kind of comeback does not appear realistic,” notes Schwarz. While in 2017, Nestlé and AB Inbev were two companies in the top 20 with their centres in Europe, the experts at MainFirst expect that there will not be a single European company in the list from as early as 2020. “Fifty years ago, things looked quite different as companies in the automotive, oil and steel industries topped the rankings. But now technology firms are beating all the others," explains Schwarz. In his opinion, the reason for this is: “Here we have global brand manufacturers and producers of luxury goods. The USA, for instance, has benefited in recent decades from immigration policy together with upward mobility opportunities afforded by the education system and a strong venture capital scene. Many children of immigrants have been exceptionally successful as founders of businesses – one example being Sergey Brin, one of the founders of Google.“ In Germany, in contrast, political conditions and an underdeveloped digital network hampered technological advancements, adds Schwarz in a critical note. “As a result, the best German minds have voted with their feet and have now conquered the second and third management levels of companies such as Amazon and Microsoft.“


Download the press release

[1] MainFirst - Global Equities Fund (C), date: 03/08/2018, ISIN: LU0864710602.





Congratulations to our MainFirst Emerging Markets team!

MainFirst's Emerging Markets team, consisting of Cornel Bruhin, Dorothea Fröhlich and Thomas Rutz, has a long track record of managing funds and mandates across different asset classes, including fixed income, equities and currencies. The team currently manages the MainFirst Emerging Markets Corporate Bond Fund Balanced as well as the MainFirst Emerging Markets Credit Opportunities Fund - and this very successfully. Since inception, both funds have achieved a performance of 35.8% and 23.6% respectively. In February 2018, Citywire rated all three managers with AAA, the highest rating. Furthermore, both funds have received a 5-star rating from Morningstar. In addition, the MainFirst Emerging Markets Corporate Bond Fund Balanced has been awarded with the €uro-FundAward.

Click here to read more

  Invest in the global companies of the future

The MainFirst Global Equities Fund invests in global companies that lead structural trends and are high in growth. This approach has generated a performance of 132 percent since its inception almost 5 years ago and outperformed the MSCI World in Euro by 51 percent.[1]

The approach of the Global Equity Team around Frank Schwarz is to look for global companies that have the highest potential for growth over the long-term, i.e. seven or more years. Their focus are not short-term sector rotations and leave to the side smaller and short-lived fluctuations in the stock markets. Instead, they research which structural trends are likely to shape the future and, thus, which companies are likely to be the frontrunners promoting and developing these trends. Three such important trends are e-commerce, digital advertising and artificial intelligence (AI).

The global growth rate of e-commerce for 2018 is estimated to be 21 percent. The two biggest companies are Amazon in the US and Alibaba in China. Amazon’s penetration in the US is currently 42% of online sales and 4% of retail sales. This makes it the number one platform worldwide (except in China). Both firms are constantly developing their product range and use data to react to new developments and trends in order to consolidate their position as industry leaders.

Amazon’s overall net revenue in 2017 was almost 178 bn USD, up from almost 136 bn USD in 2016. While Amazon has a range of products such as advertising, Amazon Web Services, and the Amazon Echo, in 2017, the majority of its net revenues were generated through online retail product sales.[2] It is estimated that its projected valuation for 2019 will be 7 times the Gross Operating Profit and 2.5 times of sales revenue. 
Alibaba already had a penetration of 80% of the Chinese e-commerce in 2014 and 10% of all retail.[3] In 2017 its gross merchandising value grew by 22% to 547 bn USD in China. Its high growth rate is expected to continue over the next years as it continues to expand its retail, cloud and financial business. 

In 2016, digital advertising revenue surpassed TV ad revenue for the first time. In the first six months of 2017 alone digital advertising grew by 23 percent YoY to 40 bn USD. Social media advertising grew by 37 percent to 9.5 bn USD. The social network giant Facebook, one of the two biggest digital advertising providers worldwide, generated 40.7 bn USD of revenue in 2017 compared to 27.6 bn USD in 2016.[4] Facebook now has a total of 2.1 bn users, WhatsApp 1.5 bn, Messenger 1.3 bn and Instagram 0.8 bn – the latter is growing at the fastest rate. 
The social network company Tencent in China, well known for its messaging service WeChat, also has a fast growing online advertising business. In 2017, it reported a 61 percent rise in third-quarter sales, online advertising revenue increased by 48% and this growth rate is likely to continue as it gets more of the market share.[5]

Another trend that is increasingly establishing itself as a long-term fundamental is AI. While the worldwide AI chips revenue was 3.2 bn USD in 2016, it is expected to rise to almost 90 bn USD by 2025.[6]
Nvidia, known as a manufacturer of graphics cards originally designed for gaming only, has diversified into AI-optimized computer chips which are now are now also available for data centers, a fast growing part of the business. The revenue of data centers accounted for roughly 20.8% in the last quarter of 2017 (compared to 13.6% one year before) meaning the business grew by 104% YoY based on the last quarter of 2017. It is believed that these high growth rates will continue. 
Keyence is a key player in artificial intelligence and robotics producing advanced automation sensors as well as bar-code readers and digital microscopes. It is benefiting hugely from industrial-automation boom as well as from the Internet of Things’ need for sensors and connectivity. It is also a producer of 3-D vision systems, a sector that is growing at a rate of 30% a year.[7] Its revenues rose by almost 22% over 2017 and net income grew by 30%.[8]

Structural trends that grow at these or comparable rates are the reasons for the choice of this approach to achieve attractive returns for investors, which has resulted in an alpha of 51% against the MSCI World Index since inception of the MainFirst Global Equities Fund C on 1 March 2013.


[1] *MainFirst Global Equities Fund C, ISIN: LU0864710602, as at 31.01.2018. 

[2] https://www.statista.com/statistics/266282/annual-net-revenue-of-amazoncom/ 

[3] https://www.forbes.com/sites/quora/2014/05/08/how-did-alibaba-capture-80-of-chinese-e-commerce/#60fe02759edd  

[4] https://www.statista.com/statistics/277229/facebooks-annual-revenue-and-net-income/ 

[5] http://adage.com/article/digital/tencent-quarterly-sales-jump-61-boosted-ads-a-hit-mobile-game/311315/

[6] https://www.tractica.com/newsroom/press-releases/artificial-intelligence-software-market-to-reach-89-8-billion-in-annual-worldwide-revenue-by-2025/ 

[7] https://www.barrons.com/articles/keyence-leading-japans-new-wave-of-tech-giants-1515815938 

[8] Source: Bloomberg



  No need to worry about the current turbulence on the stock markets

Thomas Meier, Head of Equity Fund Management, in an interview with ntv explains the stock market developments and why he remains confident:


For a more detailed assessment of the reasons for the fluctuations, see:



In the video Olgerd Eichler explains the strategy behind the MainFirst Germany Fund. The latter achieved a performance of 188 percent over five years. 

Watch the video 

  Video on how to generate market-independent returns

Benefiting from positive and negative capital markets using a conservative investment profile? In the video, Björn Esser, one of the fund managers of the MainFirst Diversified Alpha, talks about how the team uses 4 uncorrelated strategies to maximize returns for investors.

  How to successfully invest in Emerging Markets using a relative value approach

In the Citywire video, Thomas Rutz explains the investment philosophy and investment process the team uses to, for example, achieve a performance of YTD 17% (MainFirst EM Corporate Bond Fund Balanced (C), as at 30.11.2017). Of central importance are a precise analysis and in-depth knowledge of the countries and sectors in order to invest successfully independently of the benchmark.

Watch the video

  Outlook for 2018: future-oriented equities with the potential to outperform

Frankfurt am Main, 11 December 2017 Investors will not have to wait a long time to benefit from future-oriented themes such as digitalisation, artificial intelligence, automation and self-driving vehicles. Companies with structurally expanding business models should already outperform the overall market in 2018. This is the opinion of Frank Schwarz, fund manager of the MainFirst Global Equities Fund. “Future-oriented themes such as these should drive performance in the coming year in an environment that will remain challenging for equities,” explains fund manager Mr Schwarz, whose top holdings currently include Facebook, NVIDIA and Tencent.

The power of platforms is growing

The stock market expert expects particularly strong growth from online platforms better able to monetise their business models in 2018. “Platforms, in particular those belonging to the established top dogs, are seeing their power growing. The reason for this is the increasing importance of digital advertising – today a quarter of all global digital advertising revenue goes to Google and a further ten percent to Facebook,” says Mr Schwarz. Based on forecasts from market research company eMarketer, global advertising revenue will rise by almost eight percent in the coming year to around USD 629 billion. By the end of 2017, global revenues for digital advertising will have exceeded those for TV advertising for the first time. Mr Schwarz sees potential to benefit from rising advertising budgets at Facebook in particular: “User numbers for Facebook, including the in-house Messenger app, the independent WhatsApp messaging service and the photo and video platform Instagram, have been on a constant upwards trend for years. We believe that the advertising potential of Instagram in particular has been massively underestimated by the market.” The expert sees even stronger growth potential for Asian market leader Tencent, whose WeChat messaging service has a monopoly in the Asian market. The major players in the e-commerce sector are likely to also continue to take market share from traditional retailers, with market leaders Amazon in the West and Alibaba in China the main beneficiaries.

Automation and self-driving vehicles require increasing processing power

Mr Schwarz believes that NVIDIA, market leader in graphic processors and chip sets, is also a very promising stock for 2018: “NVIDIA is a beneficiary of growth in the computer games sector, where trends like virtual reality mean there is a requirement for increasingly powerful graphics performance, but there are other future-oriented trends working in their favour as well,” says Mr Schwarz. As an example, NVIDIA manufactures chips for data centres used for AI applications and the self-driving vehicles sector. Mr Schwarz believes that the company is so well-positioned in these areas versus the competition that it is possible that by 2025 NVIDIA could be the fourth-largest company worldwide by market capitalisation. Mr Schwarz also considers Japanese automation group Keyence a very promising stock, which will benefit from the trend for self-driving vehicles and greater utilisation of robots in production.

“In the current year we have outperformed the MSCI World Index in euros by a good 33 percent[1] with these and similar future-oriented shares from sectors such as semiconductor automation,” reports Mr Schwarz, adding: “We are convinced that the shares in our portfolio have the potential to achieve revenue and earnings growth of around 20 percent in 2018.”


Download the press release

[1] As at: 30 November 2017, MainFirst Global Equities Fund (C), ISIN: LU0864710602.

  SJB FondsEcho: MainFirst Absolute Return Multi Asset

"If you want to bypass the volatility of the financial markets while at the same time participating in attractive returns, you are well catered for with this flexible multi-asset fund!"

Read the complete column by Gerd Bennewirtz, author of the SJB FondsEcho here. (German only)

  The MainFirst Multi Asset Team informs – Annual review of 2017

The Fund Managers of the MainFirst Absolute Return Multi Asset and the MainFirst Global Equities Fund are usually looking several years into the future to create valuable ideas for their clients, but today they take a different perspective. They are looking back at the Year 2017.

  No getting past the emerging markets

Cornel Bruhin, Portfolio Manager at MainFirst, explains why emerging markets are currently strong and stable. As a result they offer attractive investment opportunities.

Read the article, published in Börsenzeitung (German only), here.

  Excellent rated fund management - Citywire Italy Award “Best Fund Manager 2017“

MainFirst is pleased to announce the reception of the Citywire Italy Award “Best Fund Manager 2017“ in the category of “Mixed Assets – Absolute Return EUR“.

Adrian Daniel and Patrick Vogel manage together with their team the MainFirst Absolute Return Multi Asset (ISIN LU0864714935).


We would like to thank all our customers, business partners and staff very much for the active and successful participation in this year's CHARITY DAY. Your contribution will allow us to ensure the work of MAINFIRST CHARITY also in the future and to support many important social projects. Many thanks.



  Automation is on the rise and provides interesting investment opportunities

Automation and in particular robots are reshaping the factory floor, production time and costs. Whether it is the manufacturing of iPhones, or humans with collaborative robots, or the time in which online retailers can pack and deliver their wares. This brings huge chances for investors, as revenues of such companies as Teradyne, Keyence and Ocado soar. This year alone, Teradyne grew by 70 per cent over one year, Keyence had revenues of 379,282 million JPN (respectively 3.4 billion USD, rate as at 15.11.2017) at year end 2016. Ocado’s revenues grew by almost 15 percent from 2015 to 2016. The MainFirst Global Equities Fund invests in high-growth companies such as these to generate attractive returns, resulting in a YTD performance of 41.5 per cent*.


As forward-thinking investors, the key question is whether these are trends that are likely to remain and to continue to bring attractive returns. According to Frank Schwarz, the lead fund manager of the MainFirst Global Equities Fund, which has been nominated for the Fund Manager of the Year Awards by Investment Europe, automation through robots and cobots is one of a number of structural trends that is only just beginning. The area of automation constitutes an underlying market, facilitating the production and delivery of consumer goods that is likely to exhibit further structural growth over the coming years.



Trends in automation

Keyence is a Japanese leader in automation. It manufactures the sensors, controls, bar code readers and many other devices used in manufacturing automation. Meaning that quality control now takes place in an automated fashion not only at the end but throughout the production process, picking out faulty parts much earlier, faster and more efficiently and thereby lowering manufacturing costs. Solutions include, for example, machine vision systems such as high speed cameras, smart camera sensors as well as many added services.

Another important player in the automation market is Teradyne, which currently holds approx. 60 per cent of the market share for collaborative robots or cobots. They form a central part of their product portfolio, as the current annual revenue increase lies at 50 per cent. Teradyne projects that his growth rate will continue over the next five years. Cobots work alongside humans and are increasingly spreading across production lines. While not as fast as robots, they are cheaper, mobile, can perform a variety of tasks and can be easily programmed through learning by imitation. In addition, Teradyne is expanding its distribution network as well as his third party hard- and software to be able to serve a wider variety of industry specific tasks.

Automation in use

A well-known online retailer using automation is Amazon. After they acquired Kiva in 2012, they developed a system that uses mobile robots to bring the wares to human packers instead of them having to go in search for the individual items in an order themselves. Since the roll out in 2014 in the United States, hundreds of these robots move around autonomously in a highly orchestrated manner, allowing Amazon to send a greater selection of wares to more customers more quickly.

Another company that is at the cutting edge of using automation in its processes is Ocado, the world’s largest online-only grocery retailer. The company currently ships more than 200,000 orders a week to its customers around the UK. In order to make its processes more efficient and thus be able to accelerate its growth, Ocado developed its own ground-breaking warehouse automation, increasing its efficiency, scalability as well as modularity. In their newest warehouse a fleet of 1,000 robots are collaborating together to collect the groceries stored beneath them. Ocado thereby succeeded in reducing the time it takes to pack an order of 50 items from two hours to five minutes. The biggest challenges were the coordination and controlling of the large amount of traffic and communication with and between the AI-based systems to make them all work together seamlessly, efficiently and without error.

Opportunities for investors

Given these developments in automation and the rising need for automation, Frank Schwarz and his team see great potential in this trend and hold that it will be long-lasting. It is why this investment theme is being continually monitored by the fund management team. It then chooses the companies with the highest potential and invests in them to generate attractive returns. Using this benchmark independent approach, the MainFirst Global Equities Fund has achieved returns of an average of 19 per cent annually since inception*.

*As at 31.10.2017, MainFirst Global Equities Fund (C), ISIN: LU0864710602.



  The right touch for German equities - the MainFirst Germany Fund

According to FondsXpress, Olgerd Eichler delivers top performance with the MainFirst Germany Fund. Read an analysis of the successful fund strategy in the article.

Read the article (German only)

  Attractive returns through Multi Asset - Five questions to Adrian Daniel

Adrian Daniel, Fund Manager of the MainFirst Absolute Return Multi Asset, explains how to achieve attractive returns despite low interest rates with manageable risk.

  The Power of Platforms

The concept of platforms seems innocuous. Essentially, they provide the space and structure that allows things to happen, such as expressing ideas or opinions, connecting with friends, finding online services, or running programs and apps. Yet, as for example Facebook and Google have shown, harnessed into a business model, this facilitation of exchanges, both between consumers as well as between consumers and producers, can turn into highly valuable companies and bring about profound changes in the business world. How is this possible? 

The concept of platforms is not new. For example, bazaars are an early form of platforms.  Yet combined with the possibilities of information technology and the internet, the scalability is considerably faster, vaster and cheaper. Include data mining that helps understand ever better what consumers and producers need and growth can be further enhanced.

Instead of conventional product companies, platform owners create networks that make the availability of a large and diverse set of offerings the main asset, whether this is contact with friends, tracking events or having news posted to one’s wall, to use Facebook as an example. Since such offerings are usually either free or low-cost, benefits are easy to communicate and the threshold for trying is low.

Of course, to make these new business models as successful as they are, the platform owners are continuously working to optimise the infrastructure and to add further offerings and services, which are themselves constantly being developed ever further to make sure that the platform remains the most competitive by providing the largest network with the most capabilities and interconnections as well as the best user experience. In addition, the most successful platform owners do not limit themselves to anything and constantly aim to innovate, to be ahead of the competition and invent the next big thing by not setting themselves any limits.

This is the way to ensure consumers like and use the platform. For, the greater the number of users (both consumers and producers), the greater the attractiveness of the platform as consumers only need to go to one place to get everything, meet everyone, and producers have a higher volume on consumers. The virtuous cycle this creates means that more customers attract more producers which again attract more customers. In addition, tracking customers allows platform owners to get to know their likes and needs before they know them themselves (as Steve Jobs famously said) and in some instances such as Amazon also their concrete buying behaviour. Thus, new features make the platform ever more attractive.

Consequently, one platform usually comes to dominate the industry, which makes life hard for competitors. MySpace and Facebook competed for a while until Facebook won the day. However, China's platform giants (aided by the government) show that different markets can allow other stars to rise. 

Moreover, the owner of the platform can set rules conducive to its business model in a wholly different way. Individual features and content can be made available freely, only for paying customers, in customised form or suppressed. Even when content is user-generated and freely available rules will often restrict how easy (or difficult) it is to export it. Content may also appear in a certain order, for example putting paid content such as ads either at the top of the page or in the making it look like native content within Facebook’s news stream.

Benefits for investors can be reaped especially by recognising new trends early and making long-term investments to profit from the immense growth of many of these companies. The fund management team around Frank Schwarz has shown its aptitude for this in the MainFirst Global Equities Fund. The team studies structural trends in detail and has a proven track record of investing early into platforms that came to dominate the landscape. For example, they invested in Amazon already in 2013. Since then its value has risen fivefold.


Further articles on the topic (German only):

Die Sieben Lehren des Silicon Valley

Es ist noch nicht zu spät

Angreifer aus Fernost



  Eichler’s recipe for outperformance

Through investing in selected stocks on the basis of rigorous analysis, the MainFirst Top European Ideas Fund, headed by Olgerd Eichler, achieved a clear outperformance over the last 10 years.

  For 10 years on average 5 percent better than the index - Olgerd Eichler talks about the MainFirst Top European Ideas Fund during to Börsenwoche

Eichler expects a continued friendly economic development with a lot of stock market potential and attractive opportunities for investors.

  Investments in restructurings can be significant performance contributors in a portfolio

Equity investments in company restructurings are often shunned by investors and fund managers. Indeed, who would be willing to invest in a company when it is not yet clear that a realignment will be successful, or to defend their decision-making to investors following the unsuccessful restructuring of a company in the portfolio? However, this is precisely why, in the case of a successful restructuring, commitments can feature significant prospects of high profits – in many cases even considerably more than 100 percent.

Reasons for restructuring 
There are many reasons as to why restructuring measures can be a necessary cause of action. Frequently, it’s down to the management or to a cost base that is too high. In many cases, however, it is also a result of changes in the market environment. For example, overinvestment or weaknesses in demand, whether structural or cyclical, can lead to overcapacities. Likewise, a change in the competitive environment can encourage competing companies with a superior cost structure to lower their prices, thereby dethroning more established companies. This often results in a loss of competitiveness and an accompanying decline in margins, or even negative results. In such cases, a restructuring can bring the companies back on an extremely successful course – if they have the desired effect.

Important factors for success 
Whether a restructuring is successful or not depends on a range of different factors. First of all, it is crucial that the company is not experiencing issues with the product spectrum. If the company has no products with which to compete with rivals, it may be able to improve its cost position in the short term, but will lose market shares in the future or will be forced to lower prices to keep up with the competition. The consequence is that any positive effects from the restructuring are devoured by the negative effects of falling prices and volumes. A further important success factor for restructuring is the flexibility of cost structures. For example, a capital-intensive company with large production facilities will pose a particular challenge in a restructuring, while the relocation of production to new locations and the adjustment of the workforce are often cost-intensive. The balance sheet is yet another aspect in the analysis of restructuring investments. A good balance sheet is needed in order to offset potential exceptional write-downs with equity capital. Severance payments or investments are commonly required if restructuring measures are to be implemented quickly and fully. Often, a new management team with special expertise in adjustment processes will be of great assistance.

An example of a successful realignment 
One real-world example of a successful restructuring is the printing press manufacturer Koenig & Bauer. Due to the declining market for print media, volumes have fallen for machines in the field of ​​newspaper printing. The company had too much capacity and was not flexible enough to absorb the low volumes. Consequently, the profitability took a hit and an adjustment of the cost structure was unavoidable. The good success prospects for the company were underpinned by a very healthy balance sheet structure alongside an innovative product portfolio in the field of packaging and security printing. Furthermore, the management was resolved to focus consistently on the adjustment processes, as painful and challenging as they were. A board member with experience in restructuring was also appointed. Following high exceptional depreciations, the company has successfully increased profitability year after year. Today, the company is out of the restructuring phase and is once again concentrating on organic sales growth. For the intrepid investors, an early commitment paid off, with stock that has more than quintupled in value over the past three years.

How can investors benefit 
A great deal of research, expertise and analysis is needed in order to identify companies whose restructuring measures have a high chance of success. Such stock picking of potentially undervalued companies demands precise knowledge not only of the general market situation but also of the sector and product landscape, among other areas. Moreover, in order for such an investment to be meaningful and promising, the balance sheets, restructuring measures, quality of management and growth potential must all be sufficiently examined and tested.

Two funds that have always enjoyed great successes in this regard are the MainFirst Germany Fund (ISIN: LU0390221256, unit class A) and the MainFirst Top European Ideas Fund (ISIN: LU0308864023, unit class A). These are managed by Olgerd Eichler, Alexander Dominicus and Evy Bellet, three fund managers and experts with a total of over 60 years of experience in a range of market segments, which has enabled them to invest consistently in underrated companies that have later gone on to yield profits of over 100 percent. 

  10 years of steady performance – what is the formula for success?

Since the 1990s, Europe has found itself in a low-interest phase with interest rates decreasing even further during the global financial and economic crisis of 2008. Only now are they beginning to rise again with a very moderate increase. However, it is unlikely that they will reach their former heights – at least in the near future. Investors nevertheless want to generate positive returns. How can this be achieved? 

One answer is provided by Olgerd Eichler, fund manager at MainFirst. Eichler manages, among others, the MainFirst Top European Ideas Fund, which is currently celebrating its 10th anniversary. During this time, it has achieved consistent performance without significant setbacks. At present, Eichler expects the economic recovery that began in 2012 with the defensive stocks to continue in 2017, above all with cyclicals. This catch-up effect was already apparent in the second half of 2016, when sectors such as the automotive industry demonstrated good performance. Nonetheless, the skillful selection of high-growth companies is essential, as not all companies develop equally.

That is why Eichler and his team conduct targeted stock picking. The aim is to identify companies with high growth potential – ‘young SAPs’, so to speak – and to invest in these over the long term. This holds regardless of sector, country and market capitalisation, purely on the basis of the expected performance of the respective company. The basic requirements for the successful implementation of this approach are extensive experience, disciplined and detailed analysis, rigorous selection procedures, and excellent knowledge of the markets and sectors.

Indeed, before the team includes a company in the portfolio, it must undergo a root and branch review – or rather, a review of balance sheets and profitability. Other important criteria are the quality of management, planned further developments, strategic objectives, growth projections and the general market situation. This information is drawn not only from reports, but also validated in direct discussions with the management.

A stock is included in the portfolio only when the fund management team is convinced that there is a high performance potential, in some cases even more than 100 percent. These ‘high-flyers’ are acquired for the long term to enable the full potential of their performance to be properly tapped.

In the ten years since its launch, this strategy of the MainFirst Top European Ideas Fund has led it to outperform the benchmark by a total of 70 percent, despite numerous challenges such as the aforementioned global financial and economic crisis in 2008 or the EU debt crisis, and has achieved an accumulated performance of 101 percent (as of: 31.05.2017, share class C, ISIN: LU0308864965, performance of the benchmark STOXX EUROPE 600: 31%).

  MainFirst Equity Brokerage: Top rankings for MainFirst’s Equity Analysts at Thomson Reuters Analyst Awards

Frankfurt am Main, June 26, 2017 – Five equity analysts from MainFirst Bank were honoured for the quality of their analyses at this year’s Thomson Reuters Analyst Awards, an annual ranking conducted by the media group of the same name to recognize the best sell-side analysts. Andreas Heine, Christian Korth, René Locher and Alain-Sebastian Oberhuber all received an award while Jean-Baptiste Sergeant accepted awards in two categories.

Ebrahim Attarzadeh, Head of Equities at MainFirst, said:
„We are delighted that the excellent individual performance of our analysts was recognized by Thomson Reuters, especially as it comes in the wake of this year’s Extel Survey, which confirmed our position as one of the leading brokerage houses for German and Swiss equities. All these results once again demonstrate our aim to be one of the leading companies in European equity research.

”The Thomson Reuters Analyst Awards honour the top three "Earning Estimators" and "Stock Pickers" in a total of 14 regions. All MainFirst awards at a glance:

Construction & Materials (Europe Overall)
Top Stock Pickers: #1 Christian Korth

Insurance (Europe Overall)
Top Stock Pickers: #2 René Locher

Food & Household Products (Europe Overall)
Top Earnings Estimator: #3 Alain-Sebastian Oberhuber

Chemicals (Germany)
Top Earnings Estimator: #3 Andreas Heine

Media (France)
Top Stock Pickers: #2 Jean-Baptiste Sergeant
Top Earnings Estimator: #3 Jean-Baptiste Sergeant

  The 5% strategy – Fund overview of MainFirst Absolute Return Multi Asset

With the MainFirst Absolute Return Multi Asset, Fund manager Adrian Daniel has considerable scope to invest in equities, bonds, currencies and commodities worldwide. To date, his active use of this range has seen great success.

  French elections influence investment opportunities for government bonds

Frankfurt am Main, 06 March 2017 The current forecasts for the presidential elections in France have significantly increased the risk premiums of French government bonds over the past months. This creates attractive opportunities for investors, as the bond markets have already taken the risks of the French presidential election into account and currently offer good chances for high yields. "Investors are worried about an election victory of the eurosceptic Le Pen. However, with regard to current election forecasts, we consider this view to be one-sided," explains Adrian Daniel, fund manager of the MainFirst Absolute Return Multi Asset. Especially the poll results of the independent candidate Emmanuel Macron (En Marche!) offer attractive opportunities for the current high risk spreads with French government bonds.

Spreads of French government bonds widen

While the yield on Obligations Assimilables du Trésor (OATs) was still at 0.1 percent in the third quarter of 2016, it is now at 0.9 percent despite the fact that the European Central Bank is still purchasing French bonds worth 14.2 billion euros every month. Compared to German Bunds, the spread has expanded from 25 to 70 basis points over the past six months. By way of comparison, the interest rate difference has averaged 39 basis points over the past 25 years.

According to Daniel, the election is a binary event: with Macron and Francois Fillon of the Republicans there are two presidential candidates who would promote structural reforms, especially for a more flexible labour market. Le Pen's uncertainty about the Eurozone thus countered by the chances of reforms, comparable to the German "Agenda 2010". As the production gains are gradually weakening in Germany, a change in politics could possibly turn France into the new European economic leader.

Le Pen's chances of winning a run off are uncertain

"Le Pen currently leads the poll results for the first round, but the polls suggests that this lead is not expected to reach an absolute majority in the first run." On this basis, the MainFirst fund manager predicts a run off between Le Pen and Macron. The polls confirm that for the second round Macron is 18 points ahead of the right-wing populist. And even in the rather unlikely event of an election victory by Le Pen, it remains to be seen how far her campaign promises to weaken the EU could be put into practice. "A majority in the National Assembly could block these plans," Daniel says.

Read the full article of our fund manager Adrian Daniel 

Your press contact

Edelman.ergo GmbH 
Corinna Zawodniak 
Senior Editor 
Tel.: +49 221 912 887 52 
E-Mail: corinna.zawodniak@edelmanergo.com




(Mannheim 01/25/2017) MainFirst is pleased to announce the renewed reception of the German Fund Award (Deutscher Fondspreis) in the category of “German Equity” for the MainFirst Germany Fund A (ISIN LU0390221256). 

The concept behind the success of the top fund manager Olgerd Eichler is the investment in often undervalued German medium-sized companies. The selection of individual titles is based on strict selection criteria such as solid balance sheets, above-average profit growth and excellent management. The goal of the fund managers Olgerd Eichler, Evy Bellet and Alexander Dominicus is to achieve an attractive value development for investors in the long term.

The German Fund Award is given to companies who distinguish themselves through their particularly outstanding investment results. The selection of the best funds in each category is carried out by the renowned Institute for Asset Management (IVA), which evaluates active management performance on the basis of a specially developed portfolio and risk analysis.

If you have any questions regarding the product, please contact: MainFirst Asset Management, phone: +49 (69) 78808 143 or email: fonds(at)mainfirst.com  or visit the fund page of the MainFirst Germany Fund.



  Investors in Germany heading for a serious returns problem

Frankfurt am Main, 17 November 2017 For German investors, the chances of achieving a sustained growth in value will deteriorate dramatically if their allocation of assets remains unchanged. This is the conclusion of independent financial adviser MainFirst in a recent study. Accordingly, and considering only the current market environment, the average German will in future achieve a return of only 1.5 percent if they do not change their allocation of assets. Adjusted for inflation, the performance of their portfolio could even be in the red, at -0.3 percent.

Portfolios of German investors dangerously orientated towards interest income

“The development is alarming,” says Thomas Meier, investment expert at MainFirst. For Germans, asset value allocation may have provided attractive returns in recent years, but only thanks to an unprecedented boom in the interest rate markets. “According to our calculations, the current allocation of assets of German households has enabled an average increase in value of 2.8 percent in the past decade – over the past 20 years, value growth was even as much as 4.1 percent per year. However, in the light of the persistently low interest rate phase, those days are over,” emphasises Meier. The average German portfolio has been strongly oriented towards insurances, default guarantees and classic deposits, with a weighting of around 78 percent. The outcome: With an unchanged investment strategy, Germans will reach their savings goals only later – or they will have to significantly increase their savings.

Shares – a key driver of future return

Meier is convinced: “German investors can only counteract this development through a change in asset allocation. Without a significant increase in the allocation to equities, which still has the most attractive performance potential in the long run, it will not be possible to achieve their savings targets. In the context of pension provisions, this increase in value is too low to be able to maintain their standard of living in old age – especially as those provisions are being eaten up by inflation.”

Your press contact

Edelman. ergo
Corinna Zawodniak
Senior Editor
Tel: +49 221 912 887 52
Email: corinna.zawodniak@edelmanergo.com


About MainFirst Asset Management

MAINFIRST ASSET MANAGEMENT is an independent European multi-boutique with an emphasis on active management. The firm manages mutual funds and individual special mandates. With its multi-boutique approach, it focuses on investment strategies in selected asset classes, namely equities, fixed income and multi-asset. Experienced portfolio management teams develop strategies with a high active share and individual investment processes. The firm thus combines the expertise and flexibility of focused investment teams with the strengths and clearly defined processes of a broad-based international platform. MainFirst Asset Management forms part of the MainFirst Group, with approximately 180 employees in the locations Frankfurt, London, Luxembourg, Milan, Munich, New York, Paris, and Zurich. 

For more information (including legal information), please visit www.mainfirst.com


Thomas Meier, Head of Equity Fund Management at MainFirst, talks to n-tv about the prospects for German investors in the year to come.

  Continuing Growth in Emerging Markets – an Interview with Cornel Bruhin about Expected Developments

The fund manager and expert on Emerging Markets expects the increase in commodity prices to effect continued economic growth in the Emerging Markets. According to Bruhin, Latin America is particularly attractive for investors.

  Cornel Bruhin comments on positive developments in the Emerging Markets

The fund manager and expert on Emerging Markets comments in the Boersen-Zeitung on the excellent performance of a number of Emerging Markets in 2016 and highlights potential for further developments.  

  Haron Holding AG looking to increase its stake in MainFirst Holding AG – no impact on MainFirst business policy and customer services

Frankfurt am Main, 24 November 2016 Haron Holding AG is planning to increase its stake in MainFirst Holding AG. Accordingly, Haron Holding, which to date holds 44.9 percent of the share capital of MainFirst Holding, has made a purchase offer to the shareholders of MainFirst Holding with the aim of acquiring a further 29 percent of share capital. As with all such transactions, the offer is subject to approval from BaFin within the framework of ownership control procedures. 

The management, partners and Board of Directors of MainFirst Holding AG welcome the offer from Haron Holding. Haron has been a shareholder in MainFirst for two years and supports the business model and strategy of MainFirst Group. On the one hand, this is based on the European equity brokerage platform with highest quality research. On the other hand, this implies the successful multi-boutique approach in asset management, in which highly experienced fund management teams pursue the clearly defined implementation of their respective investment styles. An acquisition by Haron of the majority shareholding will have no influence on the business policy and customer services of MainFirst. Haron Holding is a long-term investor and reliable partner for MainFirst. 

To the press release

Your press contact 
Jörg Schüren 
Senior Consultant 
Tel: +49 221 912 887 29 
Email: joerg.schueren@edelmanergo.com 

  The Chances of Contrarian Investing explained by Olgerd Eichler

Olgerd Eichler, fund manager of the MainFirst Germany Fund, explains key points to be taken into consideration for successful contrarian investing. 

  Alexander Dominicus explains the concept behind the German Mittelstand’s success

The fund manager explains the success of German SMEs and shows, how they turn themselves into market leaders through, for example, their strong specialization in niche markets and their continuous development of new products.

  MainFirst Charity Day 2016

Following the positive feedback and a total fund raising of more than EUR 3 million for our social commitment since 2001, we will again hold a MAINFIRST CHARITY DAY this year.



On 17 November, all revenues generated in our Equity Brokerage will be transferred to our charitable non-profit organisation MAINFIRST CHARITY gGMBH and then be passed on as donations to various domestic and international social facilities. The selection of eligible projects takes place in close coordination with team members in our offices who frequently have direct or indirect personal contact with the respective organisations. We particularly promote the support of socially disadvantaged children and young people, the fight against and relief from incurable diseases, as well as the general improvement of the situation of people in distress and acute need.

For many years in Germany we have provided support to the German Child Protection Association ('Deutscher Kinderschutzbund') and the Frankfurt Food Bank ('Frankfurter Tafel') as well as supported the integration of refugees. We have also underwritten a student scholarship for newly immigrated young people. In the UK we support a children’s hospice, in the United States a facility for children with cancer and their families and in Italy two therapeutic facilities for seriously ill children.

Moreover, we strive to provide ad hoc help in crisis situations. This year, we made a donation for the victims of Hurricane 'Matthew', which caused major damage in southern Haiti.

We hope that you may support us in our social commitment and help us to continue to promote the projects that we have been committed to for a number of years. It is our hope that in this way, we can contribute to targeted and effective aid.

We look forward to many contributions to the MAINFIRST CHARITY DAY. For further inquiries please do not hesitate to contact our Sales Team.”




  Eichler talks about the MainFirst - Top European Ideas Fund

The fund manager explains the investment strategy behind the MainFirst - Top European Ideas Fund, which is to make long-term investments into undervalued companies with a high potential for growth. 

  Turnaround in the emerging markets: Three good reasons why emerging markets offer interesting investment opportunities

Frankfurt am Main, 10 August 2016 The emerging markets are on the brink of a turnaround. Three factors currently support a positive development: The recovery of the commodities market, the long-term implications of the Brexit referendum and the reluctant attitude of the Federal Reserve (FED). These factors present interesting opportunities in corporate bonds; both in the investment and the high-yield segment. This is the assessment of Thomas Rutz, Fund Manager of the MainFirst - Emerging Markets Corporate Bond Fund Balanced and the MainFirst - Emerging Markets Credit Opportunities Fund.

End of the slump in the commodities market in sight 
According to Rutz, the recovery of the commodity prices is the most important factor for new growth in the emerging markets, as the extraction of raw materials is responsible for some 50 per cent of their economic development. “The oil price, which serves as an important trend indicator in the emerging countries, is now much higher than at the beginning of the year and a month ago traded only just below the psychologically significant point of 50 US dollars per barrel for WTI crude”, says Rutz. The prices of gold, silver, copper, zinc and sugar have been displaying a sustained upward trend since mid-February. Corporate bonds in the commodities sector also continue to have a correspondingly strong potential for recovery. “Though the market is comparatively tight and the number of attractive titles is limited, new emissions in particular have performed well”, says Rutz. The fund manager takes a largely bottom-up approach and is currently increasing his engagement in Latin America – where higher commodity prices could result in stronger positive effects.

Brexit – The image of the 'safe havens' crumbles 
The Brexit vote also has consequences for developing economies. According to Rutz, the unexpected outcome of the EU referendum in Great Britain has damaged the reputation of the apparent 'safe havens'. “We are seeing a new mentality in the market: Europe is no longer seen as the Holy Grail, and although we have got off quite lightly through the first shockwaves of the Brexit, long-term consequences are to be expected – this is particularly true for the property market.” Rutz assumes that Great Britain will slide into a recession as a consequence of leaving the EU. This would have negative consequences for economic growth across Europe, up to a level of 0.5 percentage points. “Against this background, we can expect the current ECB monetary policy to continue unchanged for even longer, along with the resulting low-interest environment”, says Rutz. The search for higher yields increases the demand for bonds in developing economies, especially in the high-yield segment. According to the fund manager, this is confirmed by the fact of constant capital inflows in this asset class.

Limited influence of US Federal Reserve policy 
At the same time, Rutz says, the influence of US Federal Reserve Bank policy is currently waning. Recently, the brakes were put on the emerging markets as a result of the comments of various regional FED directors, according to which the possibility of interest rate increases was underestimated by the market. As a reaction to this, the US dollar has gained in value and caused consolidation in the emerging economies. “The attitude of the FED, however, is becoming ever more reluctant. Despite the positive labour market data recently, it is an open secret that the turnaround in US interest rates will take place step-by-step – if at all. This will reduce its impact on the emerging markets”, explains Rutz, before concluding: “Besides that, the local currencies of the emerging countries have stabilised, dampening the impacts of a stronger US dollar.” 

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MAINFIRST ASSET MANAGEMENT is an independent European multi-boutique with an active management approach. The firm manages mutual funds and individual special mandates. With its multi-boutique approach it focuses on investment strategies in selected asset classes, namely equities, fixed income and multi-asset. Experienced portfolio management teams develop strategies with a high active share and individual investment processes. The firm thus combines the expertise and flexibility of focused investment teams with the strengths and clearly defined processes of a broad-based international platform. MainFirst Asset Management forms part of the MainFirst Group, with approximately 200 employees in the locations Frankfurt, London, Luxembourg, Milan, Munich, New York, Paris and Zurich.
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