Navigating Markets: The Value-Oriented, Experienced and Independent Way

Founded in 1974 by Dr Jens Ehrhardt, DJE is a family-run company with almost 50 years of expertise and one of the largest bank-independent financial service providers in the German-speaking region. With headquarters in Pullach, near Munich, the fund company in Luxembourg and branches in Cologne, Frankfurt and Zurich, DJE manages assets of retail and institutional clients in Germany and abroad amounting to EUR 15.5 billion euros.

DJE is active in both asset management and asset administration. As an asset manager, we offer a diverse set of more than 25 mutual funds that invest in the world’s most important and attractive equity and fixed income markets. Our funds have received numerous awards from independent rating agencies. They include global, regional and thematic equity strategies, bond and money market funds as well as funds of funds. We also offer mixed funds that allow a flexible combination of different asset classes which are among the best in their peer group. Our clients are independent financial advisors, pools, banks, fund of fund managers, family offices and institutional investors in Germany, Austria, Luxembourg and Switzerland as well as Spain, Andorra, and Italy. For institutional investors, DJE also offers advice, management as well as risk management and controlling of funds and launches its own special and white label funds if desired.

DJE’s proprietary FMM methodology, focused around the three key performance-determining dimensions of fundamental, monetary and market technical factors, and originally based upon the doctoral thesis work of founder Dr. Jens Ehrhardt, is an indispensable part of our investment process. This unique investment framework is based on the principle that above-average investment performance can be achieved not only by considering fundamental factors such as overall market valuation and conducting rigorous company research, but also by incorporating certain monetary and market technical factors.

As to strategic asset allocation at DJE, the first dimension, the fundamental indicators, takes priority. DJE conducts a thorough analysis of macroeconomic indicators and stock market index fundamentals, with a focus on long-term development. This analysis helps to produce indicator-based forecasts for economic data such as GDP growth, employment and inflation and serves as a basis for market price forecasts.

The second dimension involves monetary indicators, measuring the liquidity available in equity and bond markets. DJE recognizes that liquidity is a necessary condition for sustained demand for risk assets, and central bank policies play a crucial role in this aspect.

The third dimension encompasses a comprehensive set of market technical indicators, including proprietary sentiment indicators from DJE‘s database. These indicators offer insights into important markets like equities, bonds, currencies, and commodities, particularly for short-term decision-making.

At DJE Asset allocation decisions on both a strategic and tactical level are based on the FMM methodology, allowing portfolio managers to take an active management approach rooted in in-house independent research. This approach facilitates swift and informed decision-making based on forward-looking market perspectives.

DJE‘s global security selection process incorporates our proprietary bottom-up scoring model, which consists of six categories, including analyst assessment, company meetings, sustainability criteria (ESG), valuation, momentum, security and liquidity. Each category is weighted equally, with scores ranging from -10 to +10. A security must have a positive overall score to be considered investable. The final focus list consists of approximately 50 securities selected from a reduced universe of 150 companies based on their qualitative ratings, with regular reviews by the responsible analyst in the weekly investment committee.

DJE’s Dynamic Risk Management plays an important role in managing capital for our investors and completes our investment process. Our expertise in macro analysis combined with a deep understanding of the issuers we invest in puts us in an ideal position to manage equity, duration, credit and currency risk – a skill that has made our risk-adjusted returns among the best in our peer group.

As a signatory of the UN PRI, DJE integrates sustainability criteria into its investment process, emphasizing compliance with UN Global Compact principles, excluding companies violating the Ten Principles. Furthermore, DJE excludes (depending on revenue generated with the respective business unit) corporate issuers involved in controversial and conventional weapons, thermal coal for power generation, or tobacco products, and assesses issuer scores under Freedom House Index and World Bank’s Governance Indicators for government bonds. In security selection, ESG criteria, especially the MSCI ESG Score, are considered alongside other components.

As part of our “active ownership” approach, DJE’s analysts engage with our portfolio companies on sustainability issues, actively pointing out ESG opportunities in their business activities, while also highlighting ESG risks to which they may be exposed. Voting rights are exercised responsibly in collaboration with IVOX Glass Lewis, voting in favor of environmental, social, and governance issues at shareholder meetings. Our internal ESG Committee, which reports directly to the Executive Board, oversees, and continuously improves DJE’s ESG integration.

Article published in RankiaPro