{"id":8279,"date":"2024-01-31T14:13:14","date_gmt":"2024-01-31T13:13:14","guid":{"rendered":"https:\/\/hqam.ch\/?p=8279"},"modified":"2024-01-31T14:12:53","modified_gmt":"2024-01-31T13:12:53","slug":"insight-into-swiss-equity-market-in-2023","status":"publish","type":"post","link":"https:\/\/hqam.ch\/en\/insight-into-swiss-equity-market-in-2023\/","title":{"rendered":"Insight into Swiss Equity market in 2023"},"content":{"rendered":"\t\t<div data-elementor-type=\"wp-post\" data-elementor-id=\"8279\" class=\"elementor elementor-8279 elementor-8271\" data-elementor-post-type=\"post\">\n\t\t\t\t\t\t<section class=\"elementor-section elementor-top-section elementor-element elementor-element-c6de011 elementor-section-boxed elementor-section-height-default elementor-section-height-default\" data-id=\"c6de011\" data-element_type=\"section\" data-e-type=\"section\" data-settings=\"{&quot;jet_parallax_layout_list&quot;:[]}\">\n\t\t\t\t\t\t<div class=\"elementor-container elementor-column-gap-default\">\n\t\t\t\t\t<div class=\"elementor-column elementor-col-100 elementor-top-column elementor-element elementor-element-c0b47f9\" data-id=\"c0b47f9\" data-element_type=\"column\" data-e-type=\"column\">\n\t\t\t<div class=\"elementor-widget-wrap elementor-element-populated\">\n\t\t\t\t\t\t<div class=\"elementor-element elementor-element-c712737 elementor-widget elementor-widget-text-editor\" data-id=\"c712737\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t<p><strong>Rollercoaster year for Quality in Switzerland<\/strong><\/p>\n<p>Back in 2022, when all the hell broke loose in the equity markets, Quality in Switzerland, same as in other regions across the globe, has suffered substantial set-back performance wise. While country itself got somewhat sheltered from massive spike in inflation and interest rate hikes \u2013 although both items have experienced upward movement \u2013 Swiss companies, being global players, had to face consequences of a slowdown in economic growth and weak consumer sentiment. We have always argued that given the very nature of Quality companies, they would be sailing strong even if operational momentum goes through temporary phase of weakness. But as investors attempted to protect their worth by either fleeing into cash or Commodities that soared as a result of the war in Ukraine, sentiment was clearly set to overlook long-term picture in the face of immediate, short-term fears. Fundamental quality and durable business models \u2013 something that is well known to generate solid long-term shareholder returns \u2013 were largely ignored and therefore did not provide shelter to the investors during those turbulent times.     <\/p>\n<p><em>Figure 1: Indexed Total Return Performance (October 2022=100) of Quality and Non-Quality clusters, regardless of Valuation (Gross, in CHF) 30.10-2022-31.12.2023<\/em><\/p>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-afdafa7 elementor-widget elementor-widget-image\" data-id=\"afdafa7\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"image.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t\t\t\t<figure class=\"wp-caption\">\n\t\t\t\t\t\t\t\t\t\t<img fetchpriority=\"high\" decoding=\"async\" width=\"943\" height=\"512\" src=\"https:\/\/hqam.ch\/wp-content\/uploads\/2024\/01\/Review-Bild-1.png\" class=\"attachment-large size-large wp-image-8274\" alt=\"\" srcset=\"https:\/\/hqam.ch\/wp-content\/uploads\/2024\/01\/Review-Bild-1.png 943w, https:\/\/hqam.ch\/wp-content\/uploads\/2024\/01\/Review-Bild-1-300x163.png 300w, https:\/\/hqam.ch\/wp-content\/uploads\/2024\/01\/Review-Bild-1-768x417.png 768w\" sizes=\"(max-width: 943px) 100vw, 943px\" \/>\t\t\t\t\t\t\t\t\t\t\t<figcaption class=\"widget-image-caption wp-caption-text\">Source: H\u00e9rens Quality AM, MSCI<\/figcaption>\n\t\t\t\t\t\t\t\t\t\t<\/figure>\n\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-9a76a12 elementor-widget elementor-widget-text-editor\" data-id=\"9a76a12\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t<p>As fears subsided and dust settled, market was able to think rationally yet again. And, as one would expect, investors began picking up competitive and financially sound companies as 2023 entered the stage. All the points we have been relentlessly making back in 2022 \u2013 that Quality stocks are more than equipped to deal with exogenous shocks and input costs inflation because of the strong pricing power and well managed cost base \u2013 have finally come to be appreciated.  <\/p>\n<p>As a result, Quality in Switzerland came back strong in the beginning of 2023 and held up well right until the end of May, when tables turned and Non-Quality began taking up the pace, predominantly driven by com-panies from the Financial sector (Figure 1). While Swiss Quality has very limited exposure to this sector (4.5% weight), Financials have rather substantial weight in the broader benchmark (16% in MSCI Switzer-land). Also, as reporting season unfolded during summer, selective Quality stocks fell out of favour as gen-eral sentiment over relevant industry turned sour or lack of guidance upgrade was perceived as a sign of weakness, despite operational performance remaining very solid.    <\/p>\n<p>As we were closing in on 2023, markets flipped once again, and rally of Quality was so strong in November that in just one month Switzerland Quality Fund managed to close the underperformance gap that it had accumulated throughout the year and even generate outperformance during December to finish 2023 on the positive relative note. <\/p>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-8c079df elementor-widget elementor-widget-text-editor\" data-id=\"8c079df\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t<p style=\"text-align: center;\"><strong>You can access the full Annual Review <\/strong><strong style=\"font-size: 16px; font-style: normal;\">2023 <\/strong><strong style=\"font-size: 16px;\">for the Switzerland Quality Fund via the link below. <\/strong><\/p>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-bed33f9 elementor-align-center elementor-tablet-align-center elementor-mobile-align-justify elementor-widget elementor-widget-button\" data-id=\"bed33f9\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"button.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t<div class=\"elementor-button-wrapper\">\n\t\t\t\t\t<a class=\"elementor-button elementor-button-link elementor-size-sm\" href=\"https:\/\/hqam.ch\/wp-content\/uploads\/2024\/01\/Switzerland-Quality-Fund-2023-Review.pdf\" target=\"_blank\">\n\t\t\t\t\t\t<span class=\"elementor-button-content-wrapper\">\n\t\t\t\t\t\t\t\t\t<span class=\"elementor-button-text\">PDF<\/span>\n\t\t\t\t\t<\/span>\n\t\t\t\t\t<\/a>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"<p>Rollercoaster year for Quality in Switzerland<\/p>\n","protected":false},"author":6,"featured_media":8270,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"site-sidebar-layout":"default","site-content-layout":"default","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"default","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center 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