In the second quarter investor letter, Bestinver discusses the impact on the markets of the Covid-19 crisis and how its investment strategy has been conditioned. "We find opportunities in (possibly) temporary shocks where there are capital-hungry areas and valuations protect us from temporary risk," says the manager.
As regards large companies, Bestinver has taken advantage of the "turbulence" to invest in high-quality companies that do not usually offer these purchasing opportunities, he explains. These companies include Nike, LVMH or Stryker.
In addition, in the Bestinver Hedge Value Fund, they have taken advantage of the volatility of the month of March to sell companies that had behaved well and buy companies with good balance sheets in businesses that have temporarily suffered from Covid-19, but whose business models have not they are affected in the medium and long term, for example, the 'offprice' or 'outlets' sector in the US.
At Bestinver Bolsa, its movements were a continuation of the last quarter, with the increase in NOS and the incorporation of Inditex and Arcelor. "This quarter we have incorporated one more company where the market underestimates its resistance to the changes that come as Logista and Catalana Occidente," indicate in the letter signed by Beltrán de la Lastra, director of Investments, who has signed his last quarterly letter after announcing itself in March he leaves the manager.
At Bestinver Latin America, they take advantage of the high levels of volatility in the region to continue increasing the quality and potential of the portfolio in the long term by investing in companies such as Arco, Totvs or CBD and divesting from others such as BTG Pactual or Globant.
In Fixed Income, the manager explains that it has been a quarter of strong recovery in the price of bonds after the debacle of the first quarter of the year. Eduardo Roque and his team have continued to build portfolio, – reducing liquidity, short-term bonds and covered bonds, thus increasing the duration of credit. The purchases were mainly aimed at corporate bonds and financial debt of banks and insurance companies.
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