Paul Merle

Update on... Echiquier Major SRI Growth Europe

2022 had been dominated by the invasion of Ukraine and aggressive monetary tightening as central banks battled to tame inflation, prompting investors to rotate out of growth and into value. 2023 could not have been more different.

Supported by ebbing inflation, the market began to factor in the end of the rate hiking cycle and a dovish pivot in 2024. Combined with a potential soft-landing scenario for the global economy, this outlook fuelled a sharp market rebound in 2023.

In this environment, Echiquier Major SRI Growth Europe outperformed its benchmark in 2023. Amid a favourable environment for the strategy, the fund’s performance was driven by our sector allocation, notably thanks to our over-exposure to Tech, and importantly, from positive stock selection – as demonstrated by the outstanding performances delivered by Novo Nordisk, Accenture and Inditex.



Economic outlook

We expect a mild slowdown for the global economy over the next few months. Inflation is easing, which should lead to interest rate cuts, though the latter will remain higher than their pre-Covid levels.

We have remained defensive, with high exposure to resilient growth sectors such as healthcare, staple consumer goods and luxury, which are able to withstand a weaker cycle. Our preference also goes to companies with low debt, that are able to generate cash flow amid a high interest rate environment.

We therefore sold positions that did not meet these criteria (Cellnex, Lonza) to strengthen more resilient stocks, such as Ferrari, Wolters Kluwer and Inditex.

Now that interest rate cuts are in sight, we also trimmed our positions in financials at the very end of the year, to strengthen our exposure to more cyclical stocks such as Assa Abloy, Infineon and ASML.



We initiated a position in Epiroc, a company specialised in providing equipment and services to the mining industry. This Swedish group is a high-quality company, offering strong cash flow generation, elevated and resilient margins, with over two-thirds of revenue derived from services and spare parts. The group is winning market share thanks to its innovation capabilities focusing on reducing the negative impacts of mining companies, by lowering CO2 emissions and water consumption and improving safety through electrification, digitalisation, and automation. The company should benefit from growing capex within the mining industry, driven by the rising need for the heavy metals that are critical for the energy transition.


Investment strategy

In 2024, we shall continue to deploy our conviction-driven investment strategy, with a concentrated portfolio of around thirty positions at end December. Our thorough selection process continues to emphasise quality growth companies: sector leaders, with high pricing power [1] and a proven ability to manage their environmental, social and governance risks. The fund is exposed to key sustainability themes, including digitalisation (around 30% of the fund), rising healthcare spending (25%) and the energy transition (15%), which offer attractive growth opportunities for the years to come. We believe your fund is well positioned to navigate the current economic environment.



Disclaimers: Past performance is not an indication of future performance. The stocks referred to are given by way of example. Neither their presence in the portfolio nor their performance are guaranteed. The opinions expressed in this document are the authors’ own. LFDE shall not be held liable for these opinions in any way. The fund is primarily exposed to the risk of capital loss, equity risk, small and mid-cap investment risk and discretionary management risk. For more information on the characteristics, risks, and costs of these funds, and before investing, we invite you to read the regulatory documents available on our website at


[1]Ability to raise their prices