Bellevue Asset Management

BB Entrepreneur Switzerland celebrates its 10th year anniversary - Seite 2

Continuity instead of short-term maximization of profits

This can be traced to the personal financial commitment of the family owners and their close bond with the company, which engenders a long-term perspective. "Family businesses think in generations, not quarters and that is good for stability," Lead Portfolio Manager Birgitte Olsen points out. Olsen knows what she's talking about. In over 300 meetings a year, she and her team get to know exactly how business owners think and act. Entrepreneur-owned companies are characterized by strong balance sheets, lean cost structures, high innovation, a sharp focus on market niches with a highly international approach, and stable customer relationships. "Continuity and operational sustainability come before the short-term maximization of profits," she adds. A strong sense of responsibility and a natural disinclination to run the company on borrowed money translate into solid balance sheets and greater resistance to external shocks.

Expansion of the entrepreneur strategy

Bellevue has established itself as a provider of entrepreneur funds over the years. The investment universe covered by Olsen and her team was expanded with the launch of BB Entrepreneur Europe in April 2009 and     BB Entrepreneur Europe Small in June 2011, which concentrates on small and medium-sized entrepreneurial companies across Europe. All three funds invest in listed companies in which an entrepreneur or a family hold at least 20% of voting rights. Total assets in the Entrepreneur funds managed by Olsen and her team amount to CHF 180 million.

Current environment offers stock-pickers attractive returns

The first few months of 2016 have been turbulent and the rest of the year is likely to remain challenging for investors. Stock markets have correlated rather closely with oil prices lately. Investors are currently rotating out of defensive sectors such as health care and food and into more cyclical sectors such as construction materials and industrials, which Olsen says is one reason for the Swiss market's recent underperformance. Given its focus on family-owned companies, BB Entrepreneur Switzerland's investments are well diversified across a top-quality selection of owner-managed businesses, well beyond the index heavyweights on the SPI. Its very strong performance in the first quarter of 2016 can be traced to both successful stock-picking and the underweighting of large cap stocks. More than half of the fund's assets are invested in small companies with a market cap of less than CHF 2 billion. That will continue to be the right strategy for delivering an above-average return to fund investors over the next 10 years.