saraselect · 2020-05-13 · independent we make our own decision and implementation-> no...

SaraSelect

Invested with conviction in Swiss quality

Zug, May 2020

Agenda

© VV Vermögensverwaltung AG

Unique Approach

Investment Philosophy

Focus Small Caps

Investment Process

Our Value Added

Outlook / Conclusion

VV Vermögensverwaltung AG

207.05.2020

Unique ApproachSelection is the key to success

© VV Vermögensverwaltung AG 3

We invest with conviction in Swiss quality

Invested in global market leaders, in high quality Swiss small and mid caps

We favor entrepreneurial lead approaches to management lead ones

Distinct stock picking – we have learned to say NO

Preference for B2B against B2C

Vast experience – fund exists since 1996

Amongst the leaders in our industry – assets of CHF ~700 m

07.05.2020

Introduction

Attractive PerformanceSaraSelect ytd as of 8 May -5.78% vs benchmark -12.93%

Source: VV AG, Bloomberg / 30.04.2020

Period 31.01.1996 – 30.04.2020

© VV Vermögensverwaltung AG 408.05.2020

Introduction

0100200300400500600700800900

1'0001'1001'2001'3001'4001'5001'600

1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020

YTD 1M 1 yr 3 yr 5 yr 10 yr since inception

Fund -7.87% 10.28% -2.03% 1.67 % p.a. 11.41 % p.a. 9.65 % p.a. 9.19 % p.a.

Index -13.88% 6.00% -6.39% 1.45 % p.a. 6.71 % p.a. 8.01 % p.a. 8.72 % p.a.

Attractive SegmentSwiss World Champions as global leaders in their niches


Sika: Building Envelope Solutions for all

type of Buildings140 million dollar deal

Tesla signs 3-year-contract with Bossard!fff

Nespresso renews contract with Dätwyler

Introduction

Belimo technology in the world’s

highest building

07.05.2020

Ideal formula…

This will automatically lead to better products, high market shares and pricing power


Prerequisite for success

Introduction

Success = ƒ(entrepreneurs, passion, culture, focus, time, courage, innovation, responsible

anchor shareholder, not too many short-term oriented financial shareholders)

Competitive forcesHigh market shares as a prerequisite for and result of success

The understanding of competitive forces within an industry allows better decisions

Source: VV AG, VAT, Michael Porter’s “five forces” / 03.03.2020


High correlation of marketshare development and reported margins

07.05.2020

Introduction

MegaTrends

Communication

Environ-ment &Energy

Aging & Lifestyle

Security &Regulation

Urbani-zation

Mobility

Tomorrow’s winners…

Speaking of mega trends there’s no way around involving Swiss companies


Attractive Prospects

Introduction

http://www.datwyler.com/home.html

http://www.bossard.com/

ESG as one criterium for success…

Speaking of ESG, there’s no way around involving Swiss companies


UN SDG implementations monitored

Introduction

80.6%

53.8%

10.6%

24.4%

75.0%

49.4% 52.5%

13.1%

86.3%80.0%

11.3%

30.0%

90.0%

61.3%67.5%

20.0%

0%

20%

40%

60%

80%

100%

Good Healthand well

being

QualityEducation

Clean Waterand

Sanitation

Affordableand clean

Energy

Industry,Innovation

andInfrastructure

SustainableCities and

Communities

ResponsibleConsumption

andProduction

ClimateAction

UN SDGs Adoption(8 out of 18 goals taken)

Our universe SaraSelect

Independent

We make our own decision and implementation

-> No conflicts of interest nor blind index tracking

Demanding

We focus consciously on quality

-> Holding of only few but solid companies

Patient

We invest with a timeline of 5 – 7 years

-> No distraction by monthly or quarterly performances

Dedicated

We cultivate an intensive exchange with the companies

-> We get actively involved with the firm

Responsible

Our basic PrinciplesAs investors we are:

Responsible action pays off in sustainable returns



Being invested over the cyclesSuccessful market timing is very difficult

Performance is done in very short periods, missing them leads to much lower results




07.05.2020

9.6%

5.2%

2.2%

-2.7%-4.0%

-2.0%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

average performance without best 30 days without best 59 days = 1% without best 117 days = 2%

Average yearly return SPISMC Indexfrom 31 January 1996 to 30 June 2019

Being invested over the cyclesVolatility as a sub-optimal risk measure

With 7 years investment horizon no loss is incurred




07.05.2020

-20%

0%

20%

40%

60%

80%

100%

120%

140%

160%

180%

200%

SaraSelect rolling 7 year performance

SaraSelect yearly average performance 10.11%

-60%

-40%

-20%

0%

20%

40%

60%

80%

SaraSelect rolling 12 month performance

SaraSelect yearly average performance 10.11%

Swiss small & mid cap yield triangleA long-term horizon is the only guarantee for positive performance

No loss with some years investment horizon




07.05.2020

1995

1996 12.8%

1997 28.5% 46.4%

1998 23.5% 29.1% 13.9%

1999 24.3% 28.4% 20.3% 27.0%

2000 24.3% 27.4% 21.6% 25.7% 24.4%

2001 12.6% 12.6% 5.5% 2.8% -7.5% -31.3% Annual Swiss small & mid index returns

2002 6.3% 5.3% -1.4% -5.0% -13.7% -28.1% -24.8%

2003 9.5% 9.1% 3.9% 2.0% -3.5% -11.3% 0.7% 35.0%

2004 9.9% 9.5% 5.1% 3.7% -0.5% -5.9% 4.6% 23.3% 12.6%

2005 12.0% 11.9% 8.2% 7.4% 4.5% 0.9% 11.0% 26.5% 22.4% 33.0%

2006 14.1% 14.2% 11.1% 10.8% 8.6% 6.2% 15.9% 29.1% 27.2% 35.1% 37.3%

2007 13.4% 13.4% 10.6% 10.2% 8.3% 6.2% 14.1% 24.1% 21.5% 24.6% 20.6% 6.0%

2008 7.9% 7.4% 4.5% 3.6% 1.2% -1.3% 3.9% 9.7% 5.2% 3.4% -4.9% -20.9% -40.9%

2009 9.3% 9.0% 6.4% 5.7% 3.8% 1.7% 6.8% 12.3% 8.9% 8.2% 2.8% -6.7% -12.5% 29.6%

2010 10.0% 9.8% 7.4% 6.8% 5.2% 3.4% 8.2% 13.3% 10.5% 10.1% 6.0% -0.6% -2.7% 24.8% 20.1%

2011 7.9% 7.6% 5.2% 4.6% 2.9% 1.1% 5.1% 9.1% 6.2% 5.3% 1.3% -4.6% -7.1% 8.0% -1.5% -19.1%

2012 8.3% 8.0% 5.8% 5.3% 3.7% 2.2% 5.9% 9.6% 7.1% 6.5% 3.1% -1.7% -3.1% 9.6% 3.6% -3.7% 14.6%

2013 9.3% 9.1% 7.1% 6.7% 5.4% 4.1% 7.7% 11.3% 9.2% 8.8% 6.1% 2.2% 1.6% 13.3% 9.5% 6.2% 21.7% 29.3%

2014 9.5% 9.3% 7.5% 7.1% 5.9% 4.7% 8.1% 11.4% 9.5% 9.2% 6.8% 3.5% 3.2% 13.2% 10.2% 7.8% 18.7% 20.8% 12.9%

2015 9.6% 9.4% 7.7% 7.3% 6.2% 5.1% 8.3% 11.4% 9.6% 9.3% 7.2% 4.3% 4.1% 12.9% 10.3% 8.5% 16.7% 17.4% 11.9% 11.0%

2016 9.6% 9.4% 7.7% 7.4% 6.3% 5.3% 8.4% 11.2% 9.6% 9.3% 7.4% 4.8% 4.7% 12.4% 10.1% 8.6% 15.1% 15.3% 10.9% 10.0% 9.0%

2017 10.4% 10.3% 8.7% 8.5% 7.5% 6.6% 9.6% 12.4% 10.9% 10.8% 9.1% 6.8% 6.9% 14.2% 12.4% 11.4% 17.4% 18.0% 15.4% 16.2% 18.9% 29.7%

2018 9.1% 8.9% 7.4% 7.1% 6.1% 5.2% 7.8% 10.3% 8.8% 8.6% 6.9% 4.7% 4.6% 10.7% 8.8% 7.4% 11.9% 11.4% 8.2% 7.0% 5.7% 4.1% -16.4%

2019 9.9% 9.8% 8.3% 8.1% 7.2% 6.4% 9.0% 11.4% 10.0% 9.9% 8.4% 6.4% 6.5% 12.3% 10.7% 9.7% 14.0% 13.9% 11.5% 11.3% 11.3% 12.1% 4.2% 30.0%

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Year in with Swiss small & mid cap index was bought

Ye

ar

in w

hic

h S

wis

s s

ma

ll &

mid

ca

p in

de

x w

as s

old

We define quality as follows:

… invested in Quality IWe have high quality requirements

In many cases, small caps meet these requirements particularly well


Sound Management Trustworthy and entrepreneurial spirit

Attractive Business Model Leading products in several lucrative business markets

Free Cash Flows High level of internal financing

Strong Balance SheetHigh equity ratio, moderate debt level, assets of good

quality


07.05.2020

We try to avoid the following sectors:

In our search of quality we on purpose avoid certain areas

… invested in Quality II


BanksLack of visibility and predictability of income streams,

principle-agent problem, regulatory risks

Insurance CompaniesUnattractive business model, large and risky bond

portfolios especially in times of low interest rates

UtilitiesPolitical and regulatory risks, questionable expansion

abroad, high level of dependency on energy trading

Real EstateUsually represents a separate asset class, which we do

not duplicate

Erratic business model, lack ability of internal financingVenture

(Bio- & Hitech)


07.05.2020

… thanks to innovation leadershipGlobal Innovation Index: Once again, Switzerland is at the top

State-of-the-art infrastructure, outstanding education and an attractive business environment ensure a high level of competitiveness.

Source: VV AG, www.globalinnovationindex.org 2019


Reasons for Switzerland’s

high innovative capacity:

• Sizeable industrial sector

• Over 320’000 small and

medium enterprises

(>99% of all companies)

create innovation

pressure

• Innovation stimulated by

tax reliefs

• State-of-the-art

educational system


07.05.2020

Outperforming Segment in SwitzerlandBy far the best performance in the long run

In the long run, small caps outperform large caps by over 3% yearly and mid caps by over 1%.



Period 01.02.1996 – 30.04.2020

Focus Small Caps

07.05.2020

0

200

400

600

800

1000

1200

1400

1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020

Small Cap Index Mid Cap Index SMI Total Return

(Perf. 10.09% p.a.)

(Vol. 12.64% p.a.) (Vol. 14.71% p.a.)

(Perf. 8.69% p.a.) (Perf. 7.26% p.a.)

(Vol. 11.18% p.a.)

PositionSmall -

Mid

SaraSelect

(Weighting)

Index

(Weighting)

Performance

YTD

ALSO Holding AG M 9.68% 0.34% 24.27%

Bachem Holding AG S 8.63% 0.30% 49.17%

Sika AG L 6.72% 0.00% -10.93%

LEM Holding SA M 6.31% 0.29% -12.22%

Belimo Holding AG M 6.29% 1.16% -10.01%

Daetwyler Holding AG M 4.40% 0.47% -9.43%

Interroll Holding AG M 4.31% 0.43% -15.68%

Logitech International SA M 4.31% 2.60% 1.48%

Bell Food Group AG S 4.30% 0.18% -5.92%

Bossard Holding AG M 3.79% 0.27% -30.00%

Chocoladefabriken Lindt & Spru M 3.43% 3.01% 2.39%

Gurit Holding AG S 3.29% 0.18% -6.51%

Bobst Group SA M 3.02% 0.13% -11.62%

Huber + Suhner AG M 2.87% 0.39% -17.10%

CPH Chemie & Papier Holding AG S 2.81% 0.07% -15.66%

Total Top 15 74.17% 9.84%

Stable Core PortfolioOur largest positions are all leaders in innovation


Small Caps are particularly innovative and are therefore prominent holdings in our portfolio


The larger our positions,

the higher the degree of

our long-term conviction.

We must not invest more

than 10% of our fund

assets in a single

company. Furthermore,

the fund is not allowed to

hold more than 10% of the

voting rights of a company.

07.05.2020

Focus Small Caps

Segment allocation

Distinct Portfolio Profile

Relative sector weights SaraSelect vs Benchmark

Focus on smaller companies and industrials

Rather small companies with a strong industrial footprint offer solutions for megatrendsleading to structural growth from which they benefit.



Our Value Added

23.9%

10.5%

-2.8%

-4.0%

2.9%

-2.2%

-27.1%

-0.4%

-0.8%

-30% -15% 0% 15% 30%

Industrials

Technology

Consumer Goods

Health Care

Basic Materials

Consumer Services

Financials

Telecommunication

Utilities

34.6%

62.4%

30.5%

63.4%

89.2%

10.8%0%

20%

40%

60%

80%

100%

SMIM Mid Caps Small Caps

SaraSelect P CHF SPI Small & Mid Cap Index

Balance sheet quality

Robust and attractive valued Companies

Valuations

Well-equipped for challenging economic environment

7% discount for twice as solid balance sheets



Our Value Added

53%

24%

43%

48%

0%

10%

20%

30%

40%

50%

60%

Equity in % of assets Intangible assets in % of equity

SaraSelect Small & Mid Cap Index

24.9

14.4

4.42.1

23.0

14.8

4.22.9

0

5

10

15

20

25

30

P/E 2020 EV/EBITDA2020

Price/Bookvalue

Dividend yield(%)


Attractive Business Model IIIInterroll: Impressive revenue development in constant currencies

The real value added is becoming visible in constant currencies, this explain nicely the actual valuation

and market perception.

Source: VV AG, Interroll 2020


Our Value Added

0

200

400

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800

1'000

1'200

1'400

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19

Revenues in mn CHF Revenues at constant FX Market cap in mn CHF (rhs)

10-year local FX sales CAGR 11%

Attractive Yield in the Long-termNet performance of over 9% per annum since inception

Quelle: VV AG, Bloomberg / 30.04.2020


Our Value Added

YTD 1M 1 yr 3 yr 5 yr 10 yr since inception

Fund -7.87% 10.28% -2.03% 1.67 % p.a. 11.41 % p.a. 9.65 % p.a. 9.19 % p.a.

Index -13.88% 6.00% -6.39% 1.45 % p.a. 6.71 % p.a. 8.01 % p.a. 8.72 % p.a.

0

200

400

600

800

1'000

1'200

1'400

1'600

1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020

SaraSelect P CHF (NAV Div.adj.)

-60%

-40%

-20%

0%

20%

40%

60%

96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20


Segment performanceSmall Caps short-term neglected

Smaller companies are more innovative, the RISK-OFF mode will fade away again

Quelle: VV AG, Bloomberg / 30.04.2020


Our Value Added

Relative performance contributionsBachem as a clear highlight

Heavy weights with big temporary setbacks – RISK-OFF

Quelle: VV AG, Bloomberg / April 2020


Our Value Added

Stable Payout over YearsAppealing especially to private investors thanks to non-taxation of capital gains

Constant yearly payout, usually above Swiss government bond yield

Source: VV AG, Bloomberg / December 2019


Our Value Added

07.05.2020

-1%

0%

1%

2%

3%

4%

5%

-5

0

5

10

15

20

25

96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19

Dividend payout per share Capital payout per share

Yield SaraSelect (rhs) Yield 10y Swiss Gov (rhs)

Global PMI stands with 39.8 not in growth territory anymore. Europe with 33.4 worsening because of Germany (34.5). The US at low 41.5.

Switzerland 40.7 still below 50, other readings as well are lower than the previous month.

Italy due to crisis at 31.1 and China back to 50.8 after 52.

Leading Indicator as a Compass in the DarkStill good global growth ahead…



Global Purchasing Manager Index (PMI Manufacturing)

07.05.2020

Outlook

Apr 20 Mar 20 Feb 20 Jan 20 Dec 19 Nov 19 Oct 19 Sep 19 Aug 19 Jul 19 Jun 19 May 19 Apr 19

Global 39.8 47.3 47.1 50.3 50.1 50.3 49.8 49.8 49.6 49.3 49.4 49.8 50.4

Switzerland 40.7 43.7 49.5 47.8 48.8 48.5 48.9 44.9 47.4 45.2 48.6 49.0 49.1

Euro zone 33.4 44.5 49.2 47.9 46.3 46.9 45.9 45.7 47.0 46.5 47.6 47.7 47.9

Germany 34.5 45.4 48.0 45.3 43.7 44.1 42.1 41.7 43.5 43.2 45.0 44.3 44.4

France 31.5 43.2 49.8 51.1 50.4 51.7 50.7 50.1 51.1 49.7 51.9 50.6 50.0

Italy 31.1 40.3 48.7 48.9 46.2 47.6 47.7 47.8 48.7 48.5 48.4 49.7 49.1

UK 32.6 47.8 51.7 50.0 47.5 48.9 49.6 48.3 47.4 48.0 48.0 49.4 53.1

USA 41.5 49.1 50.1 50.9 47.8 48.1 48.5 48.2 48.8 51.3 51.6 52.3 53.4

Japan 41.9 44.8 47.8 48.8 48.4 48.9 48.4 48.9 49.3 49.4 49.3 49.8 50.2

China 50.8 52.0 35.7 50.0 50.2 50.2 49.3 49.8 49.5 49.7 49.4 49.4 50.1

Global PMI stands with 37.0 not in growth territory anymore. Europe with 11.7 worsening because of Germany (15.9). The US at low 27.0.

Switzerland 21.4 well below 50, other readings as well are lower than the previous month.

Italy due to crisis at 17.41 and China back to 43 after 26.5.

Leading Indicator as a Compass in the DarkStill good global growth ahead…



Global Purchasing Manager Index (PMI Manufacturing)

07.05.2020

Outlook

Apr 20 Mar 20 Feb 20 Jan 20 Dec 19 Nov 19 Oct 19 Sep 19 Aug 19 Jul 19 Jun 19 May 19 Apr 19

Global 37.0 47.1 52.7 52.0 51.6 51.0 51.4 51.7 52.5 51.9 51.6 52.7 53.7

Switzerland 21.4 28.1 51.9 57.3 51.3 52.6 54.5 55.8 54.9 48.9 53.7 56.1 61.8

Euro zone 11.7 26.4 52.6 52.5 52.8 51.9 52.2 51.6 53.5 53.2 53.6 52.9 52.8

Germany 15.9 31.7 52.5 54.2 52.9 51.7 51.6 51.4 54.8 54.5 55.8 55.4 55.7

France 10.4 27.4 52.5 51.0 52.4 52.2 52.9 51.1 53.4 52.6 52.9 51.5 50.5

Italy 17.4 52.1 51.4 51.1 50.4 52.2 51.4 50.6 51.7 50.5 50.0 50.4 53.1

UK 12.3 34.5 53.2 53.9 50.0 49.3 50.0 49.5 50.6 51.4 50.2 51.0 50.4

USA 27.0 39.8 49.4 53.4 52.8 51.6 50.6 50.9 50.7 53.0 51.5 50.9 53.0

Japan 22.8 33.8 46.8 51.0 49.4 50.3 49.7 52.8 53.3 51.8 51.9 51.7 51.8

China 43.0 26.5 51.8 52.5 53.5 51.1 51.3 52.1 51.6 52.0 52.7 54.5 54.4

Swissmem exportsSome countries are more important…

Germany makes up over 25% of all Swissmem exports

Source: VV AG, Swissmem / 30.04.2020


Swissmem (machine, electro & metal industry)

07.05.2020

Outlook

0.0

5.0

10.0

15.0

20.0

25.0

30.0

Swissmem Industry 1Q 2020 exports(Countries in % of total Swissmem (machine, electro + metal) exports)

Leading Indicators as compassFreight forwarders as leading indicators

China back to about 95% of the pre Covid-19 level

Source: VV AG, ZKB, GS, Bloomberg / 30.04.2020


Kühne + Nagel as a proxy for many companies

11.05.2020

Outlook

China is back

Leading Indicators as compass

Daimler as a proxy for many companies

China as leading indicators

China back to pre Covid-19 level

Source: VV AG, Daimler / 30.04.2020


Outlook

Leading Indicators as compassFreight forwarders as leading indicators

Some sort of V-shape recovery expected, after 90m units only 71m

Source: VV AG, Osram / 30.04.2020


Kühne + Nagel as a proxy for many companies

07.05.2020

Outlook

Structural growth intact

German car industry production

Pent-up demand as in 2009 ?

Shrinking on yearly basis – but high pent-up demand for the years to come

5-6mn yearly produced cars, actual low levels seen in the past with corresponding rebounds



Outlook

Anatomy of bear markets

Anatomy of bear markets

Speed of recovery

(to) fast recovery – aggressive central banks stabilize everything

Quelle: VV AG, ZKB, GS, Bloomberg / 30.04.2020


Impact of Covid-19 as «Event Driven», very rapid and harsh correction and subsequent rebound, thecomplete recovery will need some time, 1Q2020 > 2Q2020

07.05.2020

Outlook

Anatomy of bear markets (GS Study: all bear markets of the S&P500 Index since 1800)

-60%

-50%

-40%

-30%

-20%

-10%

0%

Average setback in %

0

5

10

15

20

25

30

35

40

45

50

Average duration in months

0

20

40

60

80

100

120

Average duration of the recovery

2 in 1: Home Bias and Emerging Markets ExposureMassive outperformance in Swiss francs

Smart strategy: Bias to home market combined with exposure to emerging marketsthrough global acting, well-positioned Swiss small caps



Performance comparison since 1995

07.05.2020

Outlook

0

200

400

600

800

1000

1200

1400

1600

1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018

Small Cap Index (SPI19) inCHF / 10.24% p.a.

MSCI Emerging Markets inlocal Ccy / 6.12% p.a.

MSCI Emerging Markets inCHF / 2.09% p.a.

Equities have to rise furtherRenewed P/E expansion likely, risk reward still favorable

The earnings will have to be slightly adapted, depending on the final impact of corona


© VV Vermögensverwaltung AG 07.05.2020 35

Outlook

P/E SPI +/- P/E SPI +/- P/E SPI +/- P/E SPI +/- P/E SPI +/- P/E SPI +/-

5.00% 22.3 9'892 -17% 20.0 8'855 -26% 16.7 7'379 -38% 15.0 6'638 -44% 14.3 6'325 -47% 12.5 5'535 -54%

4.50% 25.2 11'136 -6% 22.2 9'839 -17% 18.2 8'050 -32% 16.2 7'176 -40% 15.4 6'812 -43% 13.3 5'904 -50%

4.25% 26.8 11'883 0% 23.5 10'418 -12% 19.0 8'434 -29% 16.9 7'479 -37% 16.0 7'084 -40% 13.8 6'107 -49%

4.10% 28.0 12'382 4% 24.4 10'799 -9% 19.6 8'682 -27% 17.3 7'674 -36% 16.4 7'259 -39% 14.1 6'236 -48%

4.00% 28.8 12'738 7% 25.0 11'069 -7% 20.0 8'855 -26% 17.6 7'809 -34% 16.7 7'379 -38% 14.3 6'325 -47%

3.75% 31.0 13'725 15% 26.7 11'807 -1% 21.1 9'321 -22% 18.5 8'169 -31% 17.4 7'700 -35% 14.8 6'560 -45%

3.59% 32.6 14'436 21% 27.8 12'330 4% 21.8 9'644 -19% 19.0 8'416 -29% 17.9 7'919 -33% 15.2 6'718 -44%

3.00% 40.4 17'882 50% 33.3 14'759 24% 25.0 11'069 -7% 21.4 9'481 -20% 20.0 8'855 -26% 16.7 7'379 -38%

2.50% 50.6 22'407 88% 40.0 17'711 49% 28.6 12'651 6% 24.0 10'618 -11% 22.2 9'839 -17% 18.2 8'050 -32%

2.00% 67.8 29'998 152% 50.0 22'138 86% 33.3 14'759 24% 27.2 12'065 1% 25.0 11'069 -7% 20.0 8'855 -26%

1.00% 210.1 93'019 681% 100.0 44'277 272% 50.0 22'138 86% 37.5 16'583 39% 33.3 14'759 24% 25.0 11'069 -7%

0.50% -4166.7 -1'844'873 -15596% 200.0 88'554 644% 66.7 29'518 148% 46.1 20'404 71% 40.0 17'711 49% 28.6 12'651 6%

0.25% -365.0 -161'595 -1457% 400.0 177'108 1388% 80.0 35'422 198% 52.1 23'061 94% 44.4 19'679 65% 30.8 13'624 14%

*Risk premium = equity yield (Reverse P/E ratio) ./. bond yield

3.00%

ltr averagetoday

-0.524% 0.00% 1.00% 1.67% 2.00%

10yr Swiss Government Bond

Ris

k p

rem

ium

Net interest spending rising to 2.6% of GDP

Interest rates can not move up

Budget deficit to rise to 5.5% of GDP

Crowding out as a future potential danger to the system

Interest rate have to stay low short-term and will eventually dramatically increase

Source: Congressional Budget Office: «The 2020 Long-term Budget Outlook» / VV AG


Outlook

0.0

5.0

10.0

15.0

20.0

25.0

1.7 2.6

9.0 7.8

5.4 7.0

4.9

6.0

2020 2030

Spending% of Gross Domestic Product

Social Security

Major Health CarePrograms b

Other NoninterestSpending a

Net Interest

0.0

5.0

10.0

15.0

20.0

25.0

4.5 5.5

1.41.21.11.3

5.95.9

2020 2030

Revenues% of Gross Domestic Product

Individual Income Taxes

Payroll Taxes

Corporate Income Taxes

Other Revenues c

Deficit

Little euphoria in the marketsSentiment in the US crashing

No exuberance visible in the equity markets yet



Outlook

60

70

80

90

100

110

120

130

140

150

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

State Street Institutional Confidence Index2005 - 2019

USA Europe

Euphoria

No overvaluation visible yetIndicator in neutral territory

Still a long way to go for the Swiss equity market



Outlook

2'000

4'000

6'000

8'000

10'000

12'000

14'000

-4

-2

0

2

4

Jan 2005 Jan 2007 Jan 2009 Jan 2011 Jan 2013 Jan 2015 Jan 2017 Jan 2019

SPI and 10y Swiss Government Yield(3 year, normalized standard deviation)

Norm. SD 10y Swiss Gov. SPI Index (rhs)

Equity

BU

Y s

ignal ->

Equity

<-

SE

LL

sig

nal

Attractive total return of 7.8% p.a.Investors fear drawdowns more than they enjoy performance

The average performance is at an attractive long-term 7.8% p.a. but negative years happen regularly

Source: Pictet / VV AG; log scale


100

1'000

10'000

100'000

1925 1935 1945 1955 1965 1975 1985 1995 2005 2015

Swiss stocksYearly total returns (average 7.83 % p.a.)

-37.5%-46.5%

-41.3%

-42.3%

-34%

Outlook

Value generating sectors – business modelsBig differencies in the longer run

Sectors with low barriers to entry should be avoided systematically

Source: Bloomberg / VV AG / 30.04.2020


Outlook

High resilience during the financial crisis

Attractive Example

Long-term structural growth success story

Sika much less cyclical than usually perceived

Unlucky categorizations lead to misperceptions



Outlook

0

100

200

300

400

500

600

700

800

5.0%

7.0%

9.0%

11.0%

13.0%

15.0%

17.0%

200

6

200

7

200

8

200

9

201

0

201

1

201

2

201

3

EBITDA (rhs) EBITDA margin (lhs)

0.0

5000.0

10000.0

15000.0

20000.0

25000.0

30000.0

10.0%

11.0%

12.0%

13.0%

14.0%

15.0%

16.0%

17.0%

18.0%

19.0%

20.0%

200

0

200

1

200

2

200

3

200

4

200

5

200

6

200

7

200

8

200

9

201

0

201

1

201

2

201

3

201

4

201

5

201

6

201

7

201

8

201

9

Sales (rhs) EBITDA margin (lhs)

Global Covid-19 spread not a question, speed and impact will be decisive

After China now Europe and the US affected as well – sentiment suffers

Many roadshows, general assemblies, events canceled – alternative platforms

Chinese factories are ramping up again, logistics still a big problem

Central bank reactions show negative potential on the credit side (junk burst)

Next weeks will be decisive, mid-term mainly structural trends intact

“ThereIsNoAlternative” more stringent than before

Short-term outlookCovid-19 related uncertanties

Structural trends will reemerge, as soon as “dust settles”


Outlook

Swiss culture and mindset enable sustainable market leaders

Alignment of interests with management is crucial – good CG decisive

Exclude dangerous business models – say NO

High barriers to entry protect companies

B2B is more stable than B2C

Structural growth outweights cyclical growth

ConclusionInvested with conviction in Swiss quality

SaraSelect offers you immediate access to a portfolio of well-positioned market-leadersenabling structural growth and mega-trends


Conclusion

Foundation 1995

Number of shareholders 2

Business activity Fund manager of SaraSelect / individual mandates in Swiss equities

Domicile Lauriedstrasse 7, 6302 Zug

Legal form Corporation

Share capital > CHF 1mn

Supervision FINMA (Swiss Financial Market Supervisory Authority FINMA(authorized asset manager of collective investment schemes)

Auditor PricewaterhouseCoopers AG, Zurich

VV Vermögensverwaltung AGVast know-how and experience as asset managers of Swiss equities

07.05.2020© VV Vermögensverwaltung AG

Marc Possa, CFA Katharina Rauch Thomas Buri, CFA

44


Share Class P (Private) Share Class C (Clean) Share Class I (Institutional)

Fund Category Equity Fund Equity Fund Equity Fund

Fund Management JSS Investmentfonds Ltd, Basel JSS Investmentfonds Ltd, Basel JSS Investmentfonds Ltd, Basel

Portfolio Management VV Vermögensverwaltung AG, Zug VV Vermögensverwaltung AG, Zug VV Vermögensverwaltung AG, Zug

Custodian Bank J. Safra Sarasin Ltd, Basel Bank J. Safra Sarasin Ltd, Basel Bank J. Safra Sarasin Ltd, Basel

Fund Domicile Switzerland Switzerland Switzerland

Securities Number 123 406 23 229 560 27 229 341

ISIN CH0001234068 CH0232295607 CH0272293413

Date of Inception 1. February 1996 25. February 2014 22. April 2015

Currency CHF CHF CHF

Accounting Period 1. September – 31. August 1. September – 31. August 1. September – 31. August

Subscriptions/Redemptions Daily Daily Daily

Payout Date December December December

Total Expense Ratio 1.71% 1.20% n.a.

of which Management Fees 1.50% 1.00% 0.90%

Benchmark SPI Small & Mid Caps® SPI Small & Mid Caps® SPI Small & Mid Caps®

German Tax Transparency Transparent Transparent Transparent

SaraSelect Fund DetailsOverview share classes

Source: JSS Investmentfonds Ltd / December 2019

07.05.2020© VV Vermögensverwaltung AG 45

Many thanks for your interest and your attention!

© VV Vermögensverwaltung AG


Lauriedstrasse 7 • Postfach 7837 • CH-6302 Zug

T + 41 41 720 47 90 • F +41 41 720 47 91

[email protected] • www.vv-ag.ch

07.05.2020 46

While VV Vermögensverwaltung AG has made every effort to ensure that the information on this document iscorrect at the time of publication, VV Vermögensverwaltung AG can make no representation or warranty (includingliability to third parties) either expressly or by implication as to the accuracy, reliability or completeness of the saidinformation. If it’s not stated explicitly otherwise, all figures are unchecked.

Past performance does not guarantee future returns. The performance shown does not take account of anycommissions and costs charged when subscribing and redeeming units. The performance figures include all costscharged to the fund (net performance). The performance calculation is based on net asset values (NAV) withdividends reinvested. Additional commissions, costs and taxes on the level of the investor affect the performancenegatively. The bank and/or the fund's broker may receive or pay a one-off and/or recurring commission inconnection with this product, the amount of which will be communicated to you upon request. Furthermore,investments in foreign currencies include a foreign exchange risk which may increase or decrease the return dueto currency fluctuations.

Persons domiciled in the USA or US nationals are not permitted to hold shares in SaraSelect, and units inSaraSelect may not be publicly sold, offered or issued to anyone residing in the USA or to US nationals. Thispublication is intended only for investors in Switzerland.

The prospectus including management regulations of the Fund, the simplified prospectuses as well as the annualand semi-annual reports are available free of charge from the custodian bank (Bank J. Safra Sarasin Ltd,Elisabethenstrasse 62, P.O. Box, CH-4002 Basel, Switzerland) or the fund manager (JSS Investmentfonds Ltd,Wallstrasse 9, CH-4002 Basel, Switzerland).

DisclaimerImportant legal information


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