- 31 DecVector 2021 Annual Review
- 15 OctQ3 Review
- 17 AugChinese crackdowns
- 22 JulVector 2021 Semi-Annual Review
- 25 JunWhy we still like value
- 25 May'Transitory' Inflation
- 22 AprReversal to the mean?
- 17 MarVector's take on sustainable finance
- 09 MarSustainability-related disclosures in the financial services sector (SFDR)
- 19 FebDavid versus Goliath: An analysis of 2020 stock market performance
- 30 DecVector 2020 Annual Review
- 20 NovFactor momentum
- 20 OctHow will the US elections influence your portfolio?
- 25 SepAre better times for quant investing on the horizon?
- 26 AugFama/French going through its biggest drawdown since 1963
- 17 JulVector 2020 Semi-Annual Review
- 25 JunA Look At Post-Corona Market Valuations
- 25 MayUnprecedented times call for unprecedented measures...
- 23 AprVector's outlook on the Corona Crisis
- 13 MarMarket correction: sense or sentiment?
- 17 FebThe market and sector concentration
- 14 JanNotice to shareholders
- 31 DecVector 2019 Annual Review
- 17 DecFama/French going through its second biggest drawdown since 1963
- 15 NovThe Alpha Lifecycle
- 16 OctVector 2019 Q3 Review
- 10 SepA new prospectus
- 14 AugMarket Review: July
- 10 JulVector 2019 Semi-annual Review
- 14 JunAre factor premia disappearing?
- 21 MayHow persistent is regional outperformance?
- 12 AprMarket recovery: sense or sentiment?
- 12 MarMarkets solidify recovery
- 12 FebStock Markets Rebound
- 31 DecVector 2018 Annual Review
- 14 Dec2019 (outrageous) predictions!
- 20 AugTemperatures and stock markets heat up
- 18 JulVector 2018 Semi-annual Review
- 14 JunDo exporters suffer during trade wars?
- 15 MayStrong earnings put markets on the road to recovery
- 17 AprQ1 Overview
- 13 MarStock Markets: Episode VI: The return of volatility
- 02 MarVector wins Morningstar Germany and Belgium Awards!
- 22 FebVector Flexible wins De Tijd/L'Echo Awards for the third year in a row!
- 16 FebNavigator wins Morningstar France Award!
19 Aug 2022
While the old investment adage “sell in May and go away”, initially seemed to be spot on this year, stock markets rallied substantially in July, reversing most of 2022’s losses. The global equity index gained about 9.7% on a value weighted basis. Yet, on an equally weighted basis the index only increased by about five percentage points, which already hints at what kind of companies made a substantial comeback; you guessed it, the big ones!
Due to the growth boom of these past couple of years big companies are predominantly high growth companies, so all-in-all that was not a great development for a value focused investor. While growth stocks gained about 13%, value stocks had to make do with 6.6%. Our selection ended up somewhere in the middle, pretty close but slightly under the value-weighted benchmark.
Vector Navigator gained about 9.4% during the month, which is about 0.3% less than the global equity market but still 0.6% better than its peers. While we do allocate a substantial part to more growth-like sectors (i.e. technology) the names we selected within these sectors did not outperform due to the rotation away from growth at a reasonable price to deep-growth. Nevertheless, we are quite happy that we could keep up with the benchmark in a month where many of the traditional quant factors (momentum, value, volatility) took a big hit.
Vector Flexible recorded a return of 4.4% in July, outperforming the Morningstar category by 0.5% during the month. Flexible has had a very good run this year, outperforming its peers by more than 10% in 2022 and enjoying a year-to-date return that is positive (+2.31%). This month we decided to take our foot of the gas and slightly reduce the fund’s exposure to the equity markets. Currently, the fund hedges about 55% of equity risk through the use of equity futures and cash (up from 45% in June). We believe that the stock market currently incorporates quite positive scenario’s, which are not fully supported (yet) by economic figures. We deemed the recent run-up of the stock market as a good opportunity to increase our hedge at quite elevated market prices. Of course, we will keep monitoring the data to see if we will have to readjust this decision as news hits the markets in the weeks and months to come.
Werner, Thierry & Nils