The evolutionary power of financial innovation
It’s no secret that technological innovations such have already transformed the way people communicate, shop and perform banking transactions. The near future looks radically different to today, and the Jupiter Financial Innovation fund provides investors with a way to activate the long-term power of this structural growth trend.
The last decade has seen dramatic change for the financials sector. While the large banks and insurers still have a critical role to play, technological developments, new regulations and the rise of digital-savvy millennials have combined in recent years to form an irreversible trend towards financial innovation across the sector. As disruptors have emerged and established players invest in new technologies, the pool of potential investment opportunities has significantly expanded.
The fund manager seeks out the leading ‘users’ and ‘enablers’ that are set to benefit from long-term structural changes in the financial sector, particularly in areas such as digitalisation, payment solutions, data analytics, and security.
An unconstrained investment approach
The fund manager combines top-down analysis of macroeconomic and structural growth trends with bottom-up analysis of individual stocks. The aim is to generate long-term returns for the fund’s investors by identifying underappreciated companies which the manager believes will drive, enable or benefit from structural change ongoing within the financial sector.
Disruptive technology and financial innovation
Companies need to maximise all modern technologies to compete successfully, so the fund invests in the leading ’users’ and ‘enablers’ of sustainable and efficient financial innovations. To do so, the fund manager considers financial innovation quite broadly, including areas such as mobile payments, artificial intelligence and electronic money.
A resilient investment opportunity
A weaker post-Covid global economy may disappoint growth expectations in some places, but the digital transformation theme remains a strong investment opportunity, pushing consumers and businesses to transform the way they communicate, shop and perform banking transactions.
A diverse set of opportunities
Such is the breadth of the opportunities available in the field of finance and financial innovation, there is a very diverse set of stocks from which the fund can select. Some of these areas, spread across different continents and different sectors, have low correlation with each other, meaning that the fund’s investors gain access to a diversified selection of stocks that can complement each other to add value in different market conditions.
Meet the team
Jupiter Global Financials Team
Guy de Blonay, Fund Manager, is a financial sector specialist. Over 25 years of experience provide him with a key advantage in understanding the dynamics of a sector that continues to evolve and transform. Guy is supported in managing the strategy by Antoine Hucher (Equities Analyst) and Jenna Zegleman (Product Specialist).
Guy de Blonay
Key Fund Literature
Notes from the Investment Floor: The carbon footprint fine print
Opportunities in impact investing for climate change
Disruption: Impact investing for climate change
Sustainable investing: the importance of data science
The fund manager can use derivatives for investment purposes, to take long and short positions based on their view of the market direction, so the fund’s performance is unlikely to track the performance of broader bond and equity markets. Taking short positions creates the opportunity for a fund to deliver positive returns in falling markets, but also means that a fund could deliver negative returns in rising markets. The potential loss on a short position is unlimited, because the price of the underlying investment can carry on rising. There is also a risk that counterparties to derivatives may become insolvent, which may cause losses to the fund. The fund can use gearing, which is a method used to increase the exposure of the portfolio to financials markets through the use of loans or derivatives. Gearing may lead to large and sudden movements in the value of the portfolio. The fund invests into a specific market sector, so its value may be subject to periods of high volatility, falling and rising sharply over short periods of time. This fund invests mainly in shares and it is likely to experience fluctuations in price which are larger than funds that invest only in bonds and/or cash. The KIID and Prospectus are available from Jupiter on request. This fund can invest more than 35% of its value in securities issued or guaranteed by an EEA state.