Axiom International Ethical Fund

An option of HEDGED or UNHEDGED portfolios of dynamic and growing companies undergoing positive change, within a robust ethical framework.

January 2024 - Monthly REPORT

Global equity markets maintain upward trend


  • Falling inflation and expectations of lower interest rates later this year helped global equities perform strongly in January, with growth stocks doing particularly well; a weaker Australian dollar further boosted returns in AUD terms.
  • The US economy remains strong, giving rise to hopes of a soft landing, while Europe is struggling and China faces significant economic challenges.
  • The Portfolio returned 7.7% in January, while the benchmark returned 3.8%.


Top Holdings (alphabetically)

Adobe Inc
United States
Information Technology
Adobe Inc. develops, markets, and supports computer software products and technologies. The Company's products allow users to express and use information across all print and electronic media. Adobe offers a line of application software products, type products, and content for creating, distributing, and managing information. Adobe serves customers worldwide.
Alphabet Inc
United States
Communication Services
Alphabet Inc. operates as a holding company. The Company, through its subsidiaries, provides web-based search, advertisements, maps, software applications, mobile operating systems, consumer content, enterprise solutions, commerce, and hardware products. Inc
United States
Consumer Discretionary, Inc. is an online retailer that offers a wide range of products. The Company products include books, music, computers, electronics and numerous other products. Amazon offers personalized shopping services, Web-based credit card payment, and direct shipping to customers. Amazon also operates a cloud platform offering services globally.
Eli Lilly & Co
United States
Health Care
Eli Lilly and Company discovers, develops, manufactures, and sells pharmaceutical products for humans and animals. The Company products are sold in countries around the world. Eli Lilly products include neuroscience, endocrine, anti-infectives, cardiovascular agents, oncology, and animal health products.
Microsoft Corp
United States
Information Technology
Microsoft Corporation develops, manufactures, licenses, sells, and supports software products. The Company offers operating system software, server application software, business and consumer applications software, software development tools, and Internet and intranet software. Microsoft also develops video game consoles and digital music entertainment devices.
Novo Nordisk A/S
Health Care
Novo Nordisk A/S develops, produces, and markets pharmaceutical products. The Company focuses on diabetes care and offers insulin delivery systems and other diabetes products. Novo Nordisk also works in areas such as haemostatis management, growth disorders, and hormone replacement therapy. The Company offers educational and training materials. Novo Nordisk markets worldwide.
United States
Information Technology
NVIDIA Corporation designs, develops, and markets three dimensional (3D) graphics processors and related software. The Company offers products that provides interactive 3D graphics to the mainstream personal computer market.
ServiceNow Inc
United States
Information Technology
ServiceNow, Inc. provides enterprise information technology (IT) management software. The Company designs, develops, and produces prepackaged computer software, cloud services, and IT service management platform. ServiceNow serves customers throughout the United States.
Taiwan Semiconductor Manufactu
Taiwan, Province Of China
Information Technology
Taiwan Semiconductor Manufacturing Company, Ltd. manufactures and markets integrated circuits. The Company provides the following services: wafer manufacturing, wafer probing, assembly and testing, mask production, and design services. TSMC's ICs are used in computer, communication, consumer electronics, automotive, and industrial equipment industries.
Visa Inc
United States
Visa Inc. operates a retail electronic payments network and manages global financial services. The Company also offers global commerce through the transfer of value and information among financial institutions, merchants, consumers, businesses, and government entities.

Sector Breakdown

Capitalisation Breakdown

Region Breakdown




Pengana Axiom International Ethical Fund

The Class was established in 1 July 2017. From June 2021 Axiom was appointed as the investment manager for the Fund.

1M 1Y 2Y
Axiom Appointed
June 20211
3Y 5Y
Since Fund
July 20172
Since Strategy
July 20043
Fund: APIR (HOW0002AU)1,2

Managed by Axiom from June 2021
7.7% 33.1% 5.2% 7.6% 7.2% 11.7% 10.4%
Current Strategy (Partial Simulation)4

Axiom Global Equity Strategy
8.6% 14.2% 13.3% 8.4%
Index5 3.8% 22.3% 6.1% 8.9% 11.5% 12.3% 11.5% 7.9%

Swipe horizontally to see all columns




Global equity markets maintained the upward trend of the previous two months in January as inflation continued to moderate. This raised hopes that interest rates will start to fall in the first half of this year, helping growth stocks to outperform value. US economic activity remains robust, increasing investor expectations of a soft landing.

Inflation continues to slow around the world. In the US, the Core Personal Consumption Expenditure (PCE) Price Index, a metric closely watched by the Federal Reserve, (Fed), fell to 2.9% year-on-year in December from 3.2% in November. Increasing geo-political risk and superior US growth prospects pushed the US dollar 1.9% higher against a basket of its key trading partners’ currencies in January.

Economic activity remains mixed. The US labour market and consumer remain resilient, with December retail sales accelerating to 5.6%, while they fell a further 0.8% in Europe where economic indicators are still consistent with contraction.

China’s broader economy remains weak as it faces worsening deflation. Consumer spending is sluggish and the highly leveraged property sector remains a drag on economic growth, although the manufacturing sector continues to show signs of limited expansion.

The Fund retains its focus on dynamic growth stocks, where positive revisions to earnings per share (EPS) drive outperformance as global economic growth moderates. The Fund continues to overweight information technology, consumer discretionary and health care, while underweighting financials, energy and materials.

Strong stock performance in the information technology, consumer discretionary and health care sectors, the overweighting to information technology and the underweighting to materials contributed to relative returns. Slightly weaker stock performance in financials and the overweight position in consumer discretionary detracted modestly.

US-based semiconductor developer Nvidia was the strongest performing holding in January. This reflects robust AI server demand and the company’s increased production of its graphics processing units (GPUs). Many of its customers expect to increase investing in GPUs, as they build out their AI capabilities. Axiom’s research continues to indicate that demand for data centre GPUs is far outstripping supply.

US enterprise software company ServiceNow outperformed after reporting another strong quarter of subscription growth. It delivered initial 2024 earnings guidance, which appears to offer upside potential. Customers are willing to pay higher prices for superior products enhanced by generative AI, which should further drive earnings growth.

Taiwan-based advanced chip manufacturer TSMC outperformed after reporting fourth quarter earnings, which exceeded investor expectations. The company continues to benefit from increasing demand, driven by generative AI innovation and the recent rundown in PC and smartphone inventory levels.

US-based luggage manufacturer and retailer Samsonite underperformed in January upon weakness in the China travel market. Similarly, Hong Kong-based pan-Asia life insurer AIA Group also detracted from relative returns upon continued concerns that economic activity in China continues to slow.

Dutch technology group ST Microelectronics underperformed after reporting modestly disappointing December quarter earnings results as industrial-related customers continued to run down their inventory levels. Forward earnings guidance was also below market forecasts as the company now expects the rebound in the industrial end market to be delayed until the second half of this year.

The Fund increased its position in the Dutch supplier to manufacturers of advanced semiconductors ASML in January. This followed strong earnings results as new orders for its extreme ultraviolet lithography (EUV) photolithography machines came in well ahead of even the highest expectations. This implies that medium-term revenue and earnings forecasts might be too low.

The Fund significantly increased its position in Facebook-owner Meta Platforms ahead of it announcing its December quarter earnings results. Axiom’s analysis of digital advertising spending over the quarter revealed it would be well ahead of consensus expectations. This proved accurate, with fourth quarter results and forward guidance exceeding market forecasts and Meta unexpectedly announced it would begin paying a quarterly dividend.

The Fund increased its holding in the US-based provider of corporate uniforms and related business services Cintas, after it published strong quarterly earnings results and forward guidance. Its idiosyncratic growth strategy continues to gain momentum.

The Fund reduced its position in US-based global technology group Apple. Demand for new iPhones remains weak and the market valuation now fully reflects Axiom’s medium-term outlook on the company.

The position in Eli Lilly was reduced, as the Fund realised some of its recent strong outperformance. Axiom’s expectations for the earnings growth which is being driven by the company’s obesity drugs are now beginning to be reflected in the market valuation level.

The Fund also continued to significantly reduce the position in US-based global automotive and clean energy company Tesla ahead of its quarterly results. Recent reductions in selling prices and a multitude of negative auto industry data points highlighted slower global demand for electric vehicles.

The Fund established a new position in US-based Netflix, the dominant Subscription Video on Demand (SVOD) streaming platform. The crackdown on password sharing across the globe is expected to drive near-term earnings growth. In the medium-to-long-term, its recently launched Advertising-based Video on Demand (AVOD) offering and ongoing pricing promotions are expected to grow revenue and earnings. After spending US$17 billion on content in 2024, this amount is now expected to plateau, which should create the opportunity to grow profits as revenue continues to grow above 10% annually.

The Fund exited its position in US-based business advisory firm FTI Consulting in favour of investment opportunities which offer more attractive earnings growth. US macroeconomic data continues to be more robust than forecast, which leaves FTI’s core restructuring consulting business a less attractive hedge against a slowing economy.

The investment team followed-up its prior engagement with Meta Platforms, which discussed environmental, social and governance (ESG) issues. The meeting discussed new social initiatives which the company is progressing that may not be fully understood by the market. It is incorporating social metrics into executive pay relating to internet privacy, safety and security and is also improving transparency.

The team also engaged with the US-based global cybersecurity company Palo Alto. The company does not plan to purchase any carbon offsets, credits or unbundled renewable energy certificates (RECs) to meet its carbon goals. It intends to move to using 100% renewable electricity and is already partnering with suppliers and customers to encourage them to ensure this happens across the entire value chain.


  • Asgard eWrap
  • BT Investment Wrap
  • BT Panorama
  • BT Superwrap
  • Colonial First Wrap -IDPS
  • Centric IDPS
  • Hub24
  • IOOF Grow Wrap
  • Macquarie Wrap -IDPS
  • Macquarie Wrap -Super
  • Mason Stevens – IDPS
  • Mason Stevens – Super (Hedged)
  • Netwealth
  • Powerwrap




  • FEES * Management Fee: 1.35% p.a
  • Minimum initial investment $10,000
  • FUM AT MONTH END A$ 334.8m
  • BenchmarkMSCI All Country World Total Return Index (net, AUD)

Fund Managers

Bradley Amoils

Managing Director/Portfolio Manager

Andrew Jacobson

CEO/Chief Investment Officer


The Pengana Axiom International Ethical Fund invests in companies that are dynamically growing and changing for the better, more rapidly than generally expected and where the positive changes are not yet reflected in expectations or valuation.

The Global Equity Strategy seeks dynamic growth by concentrating its investments in global developed markets, and may also invest in companies located in emerging markets.

The investment manager is Axiom Investors, a Connecticut-based global equity fund manager formed in 1998 with over US$19billion in assets under Management.


Harding Loevner International Fund
Harding Loevner International Fund
Axiom International Ethical Fund
Axiom International Ethical Fund
Axiom International Ethical Fund (Hedged)
Axiom International Ethical Fund (Hedged)
Australian Equities Fund
Australian Equities Fund
High Conviction Property Securities Fund
High Conviction Property Securities Fund
Global Small Companies Fund
Global Small Companies Fund
WHEB Sustainable Impact Fund
WHEB Sustainable Impact Fund
Emerging Companies Fund
Emerging Companies Fund
High Conviction Equities Fund
High Conviction Equities Fund
Pengana International Equities Limited (ASX: PIA)
Pengana International Equities Limited (ASX: PIA)
Private Equity Trust (ASX: PE1)
Private Equity Trust (ASX: PE1)
Alpha Israel Fund
Alpha Israel Fund
Pengana Diversified Private Credit Fund
Pengana Diversified Private Credit Fund

Prior to June 2021, the Axiom Global Equity Strategy performance (shown in the shaded area) includes the strategy performance simulated by Pengana from the monthly gross returns of the Axiom Global Equity strategy. This simulation was done by: 1) the conversion of US-denominated gross returns to AUD, 2) applying the fee structure of the stated class. The simulation does not include the Pengana ethical screen. From June 2021 the strategy performance is the performance of the Pengana Axiom International Ethical Fund.

1. Axiom was appointed fund manager as of 5 May 2021. June 2021 represents the first full month of Axiom managing the Fund.
2. Inception date 1 July 2017. Figures shown are calculated from the continuous performance of both the current and previous strategies. For performance see row labelled Fund: APIR (HOW0002AU) in the table above which is the continuous performance of both the current and previous strategies.
3. Axiom Global Equity Strategy inception 1 Jul 2004.
4. Prior to June 2021, the Axiom Global Equity Strategy performance (labeled ‘Strategy (Partial Simulation)’ and shown in the shaded area) includes the strategy performance simulated by Pengana from the monthly gross returns of the Axiom Global Equity strategy. This simulation was done by: 1) the conversion of US-denominated gross returns to AUD, 2) applying the fee structure of the stated class. The simulation does not include the Pengana ethical screen. From June 2021 the strategy performance is the performance of the Pengana Axiom International Ethical Fund.
5. MSCI All Country World Total Return Index in AUD.
6. Performance for periods greater than 12 months are annualised. Net performance figures are shown after all fees and expenses, and assume reinvestment of distributions. No allowance has been made for buy/sell spreads. Please refer to the PDS for information regarding risks. Past performance is not a reliable indicator of future performance, the value of investments can go up and down.
7. Annualised standard deviation since inception.
8. Relative to the MSCI All Country World Total Return Index in AUD.
*For further information regarding fees please see the PDS available on our website.