Interview with fund manager Bernd Kiegler about Raiffeisen-HighTech-ESG-Aktien
“We focus on innovation and growth dynamics”
Your fund invests in high-tech companies. Can you briefly explain the difference between these and “normal” tech companies?
Bernd Kiegler: We are pursuing the goal of covering as broad a spectrum as possible of niche and growth topics in our fund and remaining flexible in our selection of names. Raiffeisen-HighTech-ESG-Aktien invests primarily in innovative technology solutions with disproportionate growth prospects.
The high-tech industry is enjoying rapid growth. How do you go about identifying companies with longer-term potential?
We carefully analyse the markets, sectors, and companies and also search for niche products that offer better financial prospects, among other things. The detailed examination of independent market and company analyses is essential in this. The most innovation is currently occurring in North America, at least right now, so this is also where our focus is – though this is not the only place we invest. A great deal is also being invested in semiconductor technology and network and telecommunication technologies in China, but access to the market and to information there is not so simple, and the regulatory environment is rather uncertain. For this reason, the USA will likely remain the technology hot spot for a few years at least.
One of your top positions in the fund portfolio is currently Nvidia. The company has seen enormous growth and is currently the market leader in AI computing. Will it be able to defend this market position?
The company offers products such as processors that are in very high demand in the AI segment. Artificial intelligence is a strong growth driver in high-tech. It remains to be seen whether Nvidia will maintain its market leadership. The massive AI demand boom is also having a positive effect on many smaller semiconductor manufacturers in which we likewise have solid positions. We still see good potential here because these companies are not as widely known.
What topics do you focus on in the fund?
In addition to innovation, we are also focusing on the medium- and long-term growth dynamics in the semiconductor industry, the increased use of artificial intelligence, and the broad spectrum of cloud computing and cybersecurity. The strong growth combined with the continued significant potential in the coming five to ten years make these topics interesting for us.
What sets Raiffeisen-HighTech-ESG-Aktien apart from other tech funds?
In terms of its investment horizon, Raiffeisen-HighTech-ESG-Aktien is more broadly based than others in its peer group. This makes us flexible in our equity picks and allows us to include a large number of specialised and growth-oriented companies.
Since the beginning of 2022, the fund has been managed according to ESG – environmental, social, and governance – aspects, as indicated by its name. Did the change have a significant effect on the composition of the portfolio?
The equities universe is large enough to provide a good selection of attractively valued but also sustainable equities. It is also worth noting that the incorporation of ESG criteria is especially easy in the technology sector compared with other sectors such as industry or energy because most companies are models in this regard. Thanks to this, the consideration of ESG criteria results in no noticeable restrictions for the fund.
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Raiffeisen-HighTech-ESG-Aktien exhibits elevated volatility, meaning that unit prices can move significantly higher or lower in short periods of time, and it is not possible to rule out loss of capital.