Generali Investments unveils SRI ageing fund
Generali Investments has unveiled the Generali SRI Ageing Population fund.
The equity fund, domiciled in Luxembourg, is managed by Mattia Scabeni and focuses primarily on European stocks. It aims to outperform the MSCI Europe Total Return Index.
“Generali wants to launch niche products and moves away from standard propositions by providing investors an opportunity to tap into a structural theme. We identified ageing as a secular thematic,” says Scabeni to InvestmentEurope.
“We have combined our SRI expertise to the theme as we believe companies with sustainable governance will be able to grow over the long run. Indeed, we believe that ESG analysis allows to better assess the risks of the companies we invest in.
“Our thematic approach along with our SRI expertise give us a 360 degree view to generate sustainable returns over the mid-long term,” he adds.
According to Scabeni, this is the right time to exploit such a thematic fund as the drivers underpinning the ageing population theme will speed up over the coming years, especially in Europe.
“Our focus is not only on the so called silver or golden economy. It also includes the related-demographic shift. Figures have shown that the current ratio is 8 people working per retired people. By 2050, this ratio will be 4 per 1 and even 2 per 1 in some developed countries,” he highlights.
“There will be a consequent shift from public to private pensions systems. This trend, which initially comes from the UK, will spread on the rest of Europe. Moreover, companies have started to downsize their pension scheme burden creating opportunities for insurers,” Scabeni tells InvestmentEurope.
The fund can invest with a cap of 25% maximum in companies that are not listed in European markets. The fund follows a bottom up approach. From the MSCI Europe (circa 450 stocks), an SRI filter is applied in addition to a qualitative and quantitative screening. Some 50 stocks are finally include in the portfolio (47 currently).
Top 10 positions in the fund form 30% of the portfolio, top 20 circa 60%. Scabeni explains he does not look at sectors as he does not want the fund to be bound by sectors definition. He says he prefers to look into industry categories.
However, he adds that some sectors have been excluded not because they are not SRI compliant but because they are not exploiting the ageing population trend.
The Generali SRI Ageing Population fund is therefore not exposed to sectors such as utilities, oil companies, automotive or commercial banks.