Monthly report August 2026 of the zCapital Swiss Small & Mid Cap Fund (class A)
The fund rose slightly by 0.1% in August (SPI Extra +0.3%). We reduced our holdings in Tecan, Forbo and SIG Group. We participated in Landis+Gyr’s share buyback. Conversely, we added to our positions in Huber+Suhner, Georg Fischer and Allreal.
In early August, some equity indices rose to new record highs following a temporary easing of tensions in the Middle East and a stabilisation in technology stocks. Concerns about high levels of government debt and uncertainty about the future course of monetary policy led to a significant rise in long-term US Treasury yields. Renewed tensions in the Middle East led to higher oil prices, keeping inflation risks elevated. Fed Chairman Kevin Warsh's comment that the inflation situation had not improved significantly was interpreted as a possible signal of rising interest rates.
In our view, the test of Warsh’s credibility lies not in the timing of the next rate hike, but in the evolution of the central bank’s balance sheet. Ample liquidity in the system is fuelling market speculation. We are also seeing rising volatility among individual Swiss equities, with little connection to fundamentals. We view such extreme movements as an opportunity for countercyclical action.
