Although the Echiquier World Next Leaders has been marketed in Spain since last March, its launch dates back to 2013. It is a fund of the French stock picking firm La Financière de l’Échiquier, managed by Rolando Grandi. Rolando Grandi Says A Bubble In Technology And Renewable By Mark1199
It invests in future themes (telemedicine, big data , artificial intelligence …), which the pandemic accelerated, with the particularity that it focuses on small and medium-sized companies. In six of the last seven years – not in 2021 – it has outperformed its category, according to Morningstar, that of global equities flexible capitalization.
What aspects have allowed this fund to beat its category in most of the last few years?
This product allows us to position ourselves in the activities with the highest growth, not only high, but also sustainable, and to benefit from a demand that is structural. Second, unlike many multithematics, you invest in medium-sized, fast-growing companies. To this is added the conviction management: we have between 25 and 35 companies in our portfolio.
In which regions do you find the most interesting values?
In the US and China, although we also see new opportunities in Europe in the renewables sector: we have invested in the French Voltalia, as well as in the German Hellofresh and in the Swedish video game group Stillfront.
The technology weighs more than 60% in the portfolio. Have they had to go out of their tech stocks by getting too expensive?
Rather than asking ourselves how much a sector weighs in the fund, or how the sector is valuing, we look at company by company. We have sold companies that became very expensive, such as the American Unity, also linked to video games, which we replaced with the Chinese Agora, a real-time communication platform. When you do stock picking you always find investment opportunities.
See a bubble in technology and renewables?
I don’t think there is a bubble or euphoria in these innovation issues. Rather, their stock market rallies reflect extremely healthy fundamental growth.
“In Spain, technological start-ups are appearing, but they need to grow and be listed on the stock market”
Do you have a Spanish company in your portfolio?
At the moment, no. In Europe, new companies are coming to the stock market, the famous unicorns, and new opportunities will soon emerge in medium-sized multi-thematic companies. Our universe is in mutation and in strong growth, both in Spain and in Europe.
And in the ‘Echiquier Artificial Intelligence’, which you also manage, is there any Spanish value? Perhaps artificial technology is not a sector in which Spain stands out.
The truth is that we do not have Spanish companies. We see startups that are appearing, but they need to be developed and listed. Sometimes they are acquired by other companies. It happened, for example, with the Sevillian technology company Novayre, which was bought by one of the companies that we have in that fund, the American Appian. By this I mean that there are Spanish companies in the artificial intelligence sector, but they are not necessarily listed on the stock market.
How challenging is the passive management boom? Rolando Grandi Says A Bubble In Technology And Renewable By Mark1199
Active and passive management must coexist. The interesting thing is that before there were many managers that replicated the benchmark , but charged their clients high commissions. That has changed. Now the managers are either really active or passive. Those of us who remain are truly active.