Vontobel launches client-backed Swiss equity fund

Banking & Payments DECODED

Previous edition: 15 May 2024
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Vontobel launches client-backed Swiss equity fund

Vontobel has launched a fund that offers investors broad-based access to a high-income Swiss equity strategy by combining Vontobel Swiss dividend and covered call concepts.

The Vontobel Fund - Sustainable Swiss Equity Income Plus is an actively managed, diversified, and sustainable option. It offers strong income potential by investing in high-quality Swiss dividend stocks merged with a covered call option overlay.

Furthermore, the fund's aim is to deliver relative outperformance in negative, stable, and rising market phases.

In addition, it has an objective to offer a recurring distribution yield of approximately 7-8% per annum from dividends and tax-free capital gains.

“With strong quality features, Swiss equities offer an interesting investment opportunity, especially during periods of economic uncertainty,” said Marc Hänni, head of Swiss equities. “Thanks to its allocation to both large- and mid-caps, the portfolio could offer investors an attractive mix of defensive, quality stocks with attractive dividend yields. Furthermore, the premiums generated by selling call options can provide not only an additional source of income, which is tax free, but also a certain degree of cushion against drawdowns in negative markets.”

“The fund leverages our long-standing Swiss equities track record and reputation, as well as our quantitative investing expertise,” added Reto Lichtensteiger, head of Switzerland. “By combining a Swiss dividend strategy with a covered call strategy, and adhering to sustainability criteria, we believe we are bringing a unique investment proposition to the Swiss market.”

Last month, Vontobel launched a three-year fixed maturity emerging market bond fund that allows investors to capitalise on higher yields.

In comparison to similar bonds in established countries, the Vontobel Fund II – Fixed Maturity Emerging countries Bond 2 aims to provide a higher spread, yield, and coupon.

Hard currency developing market bonds are the fund’s primary investment type.

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