Artemis Global Select Fund update

Source for all information: Artemis as at 31 March 2025, unless otherwise stated. 

Fund objective 

The fund’s objective is to grow capital over a five-year period.

Performance

The Artemis Global Select Fund fell 7.5% in the quarter, compared with a 4.3% loss from its first benchmark, the MSCI All Country World Index¹, and a 4.6% loss from its second benchmark, the Investment Association Global sector² average.

For full five-year discrete performance, please see below. Please remember that past performance is not a guide to the future.

The US market was responsible for a lot of the weakness in global shares during the quarter. It had been affected by growing uncertainties around President Donald Trump’s policy on trade as well as declining consumer confidence and inflation expectations.

Europe performed well, helped by interest rate cuts, better economic data and strong results from sectors that had previously struggled. Later on, Donald Trump’s call for NATO members to increase their own defence spending caused the new German government to commit a major sum to rearmament³.

Of the emerging markets, China performed strongly, thanks to hopes that its government would bring about measures to stimulate growth. Investors also reassessed the quality of Chinese technology companies involved in AI (artificial intelligence) after the launch of DeepSeek, a Chinese start-up developed at a much lower cost to US competitors⁴.

Negatives

IT and software development company Globant was the biggest detractor from fund performance over the quarter after predictions for this year’s sales growth fell. We nonetheless added to our position as the shares have rarely traded this cheaply since we bought them.

Chip designer Nvidia sold off after news of DeepSeek called into question the leadership of western technology companies involved in AI. We continue to evaluate the possible impact of this threat, noting that spending announcements since then suggest it is yet to affect demand.

Shares in Amazon and TSMC also suffered due to market fears around AI. As TSMC is the clear leader in the manufacturing of semiconductors (a key component of electrical products) we think it can overcome these short-term challenges.

Positives

Constellation Energy’s shares received a boost after its purchase of fellow energy company Calpine⁵. We sold out of the holding on the back of this outperformance.

Our new bank holding Standard Chartered got off to a strong start in the quarter and its income is growing once more. Its large share buybacks⁶ and disciplined control over costs suggest returns could improve further.

Wheaton Precious Metals announced record revenues in 2024, helped by the rising gold price.

From a relative point of view, we benefited from avoiding Tesla, Alphabet and Broadcom as shares in these companies fell.

Purchases

We started a new position in Procter & Gamble, one of the world’s largest consumer products companies. Its large scale and brand portfolio give it negotiating power when dealing with retailers such as Amazon and Walmart.

Another new position, Tetra Tech, provides management consulting and engineering services for industrial companies. The company’s shares fell significantly because of negative sentiment around its US revenues and worries that President Trump’s Department of Government Efficiency (DOGE) would cut government spending. However, our analysis suggests that even in the worst-case scenario the company can still increase revenues and profits.

We also added to tech giant Meta, the parent company of Facebook and Instagram, as we believe its innovation is resulting in stronger engagement and hence better revenues while the market seems to be underestimating its potential profits.

We also added to aerospace & defence company Safran after a fall in its share price.

Sales

We exited numerous positions during the quarter, such as chocolatier Lindt. Although it had delivered on pricing and sales growth, we felt those strengths were already reflected in its valuation.

Although we had originally intended to hold Japanese manufacturer SMC over the long term, intensifying competition led us to sell.

We also sold out of ASML due to worries that major customers such as Intel and Samsung will buy fewer of the company’s lithography machines, which are used to make semiconductors.

Outlook

The speed at which President Trump announced and then implemented tariffs caught investors by surprise and we believe that underlying conditions in the stockmarket may now have changed.

We have therefore been reassessing the outlook for our holdings as the end result of the president’s current policies is still unclear. It is vital that we understand the real impact on the earnings of the companies we hold, so we have been considering how four possible future scenarios could affect our holdings, as per the below table.

Macro scenario framework

It is now less about the impact of tariffs on companies but the impact of recession

How does each of our stocks do in the following scenarios?

Where we feel that risks are no longer reflected in share prices, we are making adjustments through both sales (for example with financial technology company Fiserv) and additions (for example in Tetra Tech). 
 
We are also viewing the current stockmarket turmoil as an opportunity to buy shares in quality businesses at discounted prices. We believe such an approach is even more important at times of market stress.