February Report

• The Fund returned -2.2%, while the benchmark delivered -0.3% in February, as weakness in information technology and healthcare weighed on returns.
• Global equities edged lower, with US tariff uncertainty and volatile economic data dampening investor sentiment. The post-election rally faded, leading to profit-taking in large-cap US technology stocks and increased caution towards highly valued growth stocks.
• Tencent and Sony were the Fund’s strongest performers. New positions were established in Shenzhen Mindray Bio-Medical Electronics, ASML, and Amphenol, reflecting the Fund’s focus on high-quality, long-term growth opportunities.

Top Holdings (alphabetically)

Accenture Plc Class A

United States

Information Technology

Accenture PLC provides management and technology consulting services and solutions. The Company delivers a range of specialized capabilities and solutions to clients across all industries on a worldwide basis. Accenture operates a network of businesses provides consulting, technology, outsourcing, and alliances.

Alphabet Inc. Class A

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.

Amazon.com, Inc.

United States

Consumer Discretionary

Amazon.com, 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.

CME Group Inc. Class A

United States

Financials

CME Group Inc. operates a derivatives exchange that trades futures contracts and options on futures, interest rates, stock indexes, foreign exchange, and commodities. The Company brings together buyers and sellers of derivatives products on its trading floors, electronic trading platform, and through privately negotiated transactions that it clears.

Meta Platforms Inc Class A

United States

Communication Services

Meta Platforms, Inc. operates as a social technology company. The Company builds applications and technologies that help people connect, find communities, and grow businesses. Meta Platform is also involved in advertisements, augmented, and virtual reality.

Microsoft Corporation

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.

Netflix, Inc.

United States

Communication Services

Netflix, Inc. engages in providing entertainment services. It also offers activities for leisure time, entertainment video, video gaming, and other sources of entertainment. It operates through the United States and International geographic segments. The company was founded by Marc Randolph and Wilmot Reed Hastings on August 29, 1997 and is headquartered in Los Gatos, CA.

Schneider Electric SE

France

Industrials

Schneider Electric SE manufactures electrical power products. The Company offers car chargers, home security goods, light switches, access control, sensors, valves, circuit breakers, cables, accessories, signaling devices, fuse, motor starters, and voltage transformers. Schneider Electric serves customers worldwide.

Sony Group Corporation

Japan

Consumer Discretionary

Sony Group Corporation manufactures and distributes electronics products and provides related solutions. The Company produces televisions, cameras, mobiles, audio and video products. game equipment, and more. Sony Group also engages in game production, movie production, music production, and other businesses.

Vertex Pharmaceuticals Incorporated

United States

Health Care

Vertex Pharmaceuticals Incorporated discovers, develops, and commercializes pharmaceutical products. The Company develops drugs for the treatment of cystic fibrosis, cancer, inflammatory bowel, autoimmune disease, and neurological disorders. Vertex Pharmaceuticals serves healthcare sector worldwide.

Market Commentary

Global equity markets edged lower in February after a strong start to the year. The US market declined modestly as concerns grew over the impact of government policies on economic growth, corporate sentiment, and consumer demand. In contrast, European equities extended their gains from January, while emerging markets were broadly flat. However, China stocks rallied as government stimulus measures and AI optimism buoyed investor sentiment.

Investor enthusiasm for Chinese stocks was fuelled by the launch of open-source AI models from DeepSeek and Alibaba. These models demonstrated greater efficiency than comparable models from US firms. Additionally, a rare meeting between President Xi Jinping and leading technology executives was widely interpreted as signalling a shift toward a more pro-business stance by Chinese policymakers.

Across global sectors, consumer staples was the best-performing sector, supported by its defensive characteristics. Meanwhile, consumer discretionary stocks lagged, reflecting concerns about consumer demand in a slowing US economy. In the technology sector, policy uncertainty and its potential impact on AI supply chains weighed on sentiment. However, the broader implications of improved AI efficiency continue to evolve, bringing the potential to lower costs, increase adoption, and expand AI applications.

Portfolio Commentary

The Fund returned -2.2% in February, while the benchmark declined -0.3%. Weakness in information technology and healthcare stocks drove underperformance as concerns about slowing US economic growth dampened investor confidence.

Tencent was the Fund’s strongest performer, rallying alongside a broader rebound in Chinese technology stocks. It benefitted from increased investor optimism following signs of a more pro-business stance from Chinese policymakers. Additionally, the company saw strong engagement and revenue growth across its gaming and advertising businesses.

Sony also outperformed after reporting strong results, supported by revenue growth in its gaming division. The company benefited from increased sales of gaming content and hardware, as well as continued momentum in its entertainment and media segments.

In contrast, the Fund’s holdings in the technology sector were a key source of underperformance. Salesforce and Globant declined amid investor concerns over slowing enterprise spending and a weaker macroeconomic outlook in the US. Additionally, Globant indicated that political and trade policy risks in Latin America could negatively impact business sentiment.

Google-owner Alphabet also detracted from relative performance as renewed competition in AI, particularly from China’s DeepSeek’s large language models.

The Fund made several portfolio adjustments in February. Taking advantage of weakness in the IT sector, the Fund re-established a position in ASML, the Dutch advanced photolithography equipment supplier. ASML had been previously sold following a prolonged rally. A series of recent developments created an opportunity to repurchase shares at a 20% discount to the previous sale price. These included a downward revision to ASML’s 2025 outlook, export control concerns, and a demand reset for extreme ultraviolet (EUV) technology. ASML remains the dominant supplier of lithography equipment, with no credible competition in leading-edge semiconductor manufacturing. The company is expected to benefit from TSMC’s 2-nanometer process node ramp-up and increased EUV adoption. Additional growth opportunities include new semiconductor manufacturing facilities in Arizona and Japan.

Over the month, the Fund exited positions in US-based global technology group Apple and Netherlands-based digital payments group Adyen due to valuation concerns. Adyen’s share price had rallied since November 2024 and surged further in February upon strong second-half 2024 results, with revenues and earnings exceeding expectations. Given the sharp rise in its valuation, the Fund took profits and exited the position. Apple was also sold as its valuation exceeded long-term return expectations, despite its strong market position.

While near-term market conditions remain volatile, the Fund continues to focus on high-quality businesses with durable competitive advantages, strong cash flows, and the ability to benefit from long-term secular growth trends.