Vontobel's Hansen drops Adidas for Hermès as a European recession looms

Shopping after growth derating

The global equities market pullback and a looming recession made Vontobel’s Markus Hansen reassess some of the holdings of his quality growth European equity fund, with Adidas one of the most recent sells.

Last month, portfolio manager Hansen sold off the sportswear brand due to concerns over the impact on athletic footwear demand in the event of a recession in Europe, increased headwinds from the brand's supply chain out of Southeast Asia and weakness in demand in China due to lockdowns. Another reason behind the sale was the opportunity to reallocate capital towards another global retailer, Hermès International, at a valuation much more attractive than the historical average. The stock has shed about 40% of its market value this year as inflation, rising interest rates and other macro...