Preface: The qualities of management

By Isabelle de Laminne

The 2021 edition of the Crystal Funds is special this year, as there are no less than five Belgian fund houses in the rankings. This means that half of the awards awarded are given to local administrators. A great boost for our Belgian administrators!

In a particularly challenging economic and financial context marked by the health crisis and low interest rates, managers had to pull out all the stops to include the good companies in their portfolios. This year's winners have shown many qualities. First, they had to be quite opportunistic. More than ever, it was necessary to invest in the right values at the right time. Sectors and stock selection, in particular, appear to have played a major role. Sometimes, the investments paid off. Sometimes they have weighed on the fund's return.

Certain administrators, who have humbly admitted to making certain wrong choices, are also showing a great deal of transparency. It was also necessary to take the reins and stay afloat during the sudden crash of the markets and subsequent recovery. Some have been far-sighted and have changed the composition of the portfolio and made certain tactical choices. It is true that some funds perform better when the markets correct, while others thrive when prices rise. In all asset classes, managers had to be extremely vigilant in these difficult times.

Some people stick to their strong beliefs that they don't deviate from. Their consistent choices have determined their performance. Most asset managers seem to be looking to the future with optimism. They appear to be confidently ready to respond to the strengthening economic growth and the expected effects of monetary and fiscal support measures. Thanks to the combination of all these qualities, the administrators have everything they need to keep performing well.

Ranking and methodology

The Crystal Funds awarded by La Libre Belgique and De Standaard can finally be awarded again in the traditional way. After more than a year of the pandemic and Covid-19 and repeated lockdowns, the vaccination campaign finally offers a bright spot. The stock markets took a big hit. Many investors panicked and sold their shares at heavy losses. Subsequently, this correction was considered as a buying opportunity. In November 2020, stock prices finally started rising again. In the portfolios, we also saw a shift towards value stocks.

In the current climate and due to the uncertainty surrounding the delta variant, it is becoming increasingly difficult to choose from the very (too?) numerous financial products on the market. All too often, investors only care about the performance of funds. Today, La Libre and De Standaard are awarding awards based on returns between July 1, 2020 and June 30, 2021. This award ceremony celebrates the best funds per category based on their performance. These Crystal Funds are issued for ten categories of funds: investors in Belgian stocks, securities investing in global stocks, European stocks, US stocks, small and mid-cap stocks, corporate bonds and government bonds. In addition, three awards are also presented to mixed patrimonial forces with a defensive, neutral and dynamic profile. The rankings are drawn up by Symex and fall under its responsibility. They are provided for illustrative purposes only. The editors of La Libre and De Standaard have opted for a simple method. Within each category, the funds are ranked according to their “pure” performance, without taking into account the fund's volatility.

This performance is calculated on the basis of one-year performance, from July 1, 2020 to June 30, 2021, which is weighted at 75%. In addition to this performance, the variation in performance over three years is weighted at 25%. Only funds that are offered to the general public (retail) in Belgium without a minimum entry threshold are included in these rankings. For each nominee and awarded fund, this element was confirmed by the issuers of the funds. This element falls under their responsibility, and the editors of the two publications cannot be held responsible for it. However, it should be remembered that performance should not be the only criterion to consider when choosing a fund. Past returns are no guarantee of future returns. We can't repeat it enough! This ranking is therefore only announced indicatively.

Under no circumstances should these awards and nominations be considered investment advice.

Also, don't forget that asset management is not a sprint but a marathon, which must be evaluated over time and in the long term

The winners speak: Patrick Millecam (Fund Manager at Vaue Square)

What is the advantage of investing in a Belgian equity fund?

A Belgian equity fund only invests in Belgian companies. Because these companies regularly appear in the Belgian media, because you can better monitor these companies, taste their products or use the products and services, this provides better peace of mind. And this is an important feature of an investor in order not to panic (sell and buy at the wrong time) and thus achieve a good long-term return. Moreover, there are only a few companies that are solely dependent on the Belgian economy.

With a Belgian equity fund, you can also benefit from economic developments in the rest of the world (Europe, the US and Asia). The merger of the Brussels stock exchange in September 2000 with those of Amsterdam and Paris gave Euronext “Brussels” sufficient critical mass as the smallest of the three. This has led to better liquidity. Over the period from 30/6/2020 to 30/6/2021, the Belgian All Shares Net Return index increased by 27%.

Value Square Fund Equity Belgium rose by 40.4% over this period; the best performance of all Belgian equity funds.

Disclaimer

This article was written at the initiative of De Standaard and was not sponsored by Value Square, it was taken over in its entirety.