HBM Healthcare Investments (SIX:HBMN) is a Swiss-listed, globally diversified healthcare fund that blends listed equities with private companies held both directly and via funds. It invests for long-term capital growth, and many of the listed stocks in its portfolio are those it has backed from an early stage as private companies. The private exposure serves a dual purpose of accessing potentially high-growth investments and limiting NAV volatility, while some of the more mature companies in the listed portfolio may become takeover targets.
The fund is well spread by clinical focus and has a bias towards companies with products already on or close to the market. Following a number of successful IPOs and trade sales, HBMN is looking to increase its private company exposure, and holds a short position in a biotech index ETF as a protection against a market downturn. A high distribution policy provides a yield of c 5%.
Investment strategy: Long-term growth focus
HBMN is managed by specialist Swiss healthcare investment firm HBM Partners, which has teams covering both listed and private healthcare companies. Most investment team members have a life sciences background, enabling them to assess potential investments from a clinical as well as a financial perspective. The approach is generally long term and low turnover, although some investments may be made on a more tactical basis in anticipation of M&A activity.
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