Performance and Portfolio Update

  • The Pax Global Environmental Markets Fund outperformed the global equity markets (MSCI ACWI) and the comparative environmental markets index (FTSE Environmental Opportunities All Share) during the third quarter.
  • As measured by MSCI ACWI, global equity markets produced positive returns in the third quarter. Yet this figure belies the complexity that investors faced while navigating equity markets during the period. Trade tariffs, Brexit, rising interest rates, and nervousness around emerging markets tested investors’ convictions in their portfolios.
  • After contributing strong returns in 2017, Industrials struggled in the first half of this year. Yet, as is often the case, such sector rotations can be exaggerated. Many industrials in the portfolio, particularly US names, proved oversold after announcing strong results in the quarter, including top contributors Hubbell (US, Power Network Efficiency) and Xylem (US, Water Infrastructure). Both names recovered in the third quarter after selling off earlier this year.
  • Holdings in the portfolio with automotive end markets were negatively impacted by the ongoing trade war. Share prices for Delphi Technologies (UK, Transportation Energy Efficiency) and Aptiv (UK, Transportation Energy Efficiency) both lagged the overall market on worries relating to the newly imposed tariffs, weaker car sales and challenges posed by higher component prices.
  • The Fund benefits from two attributes: First, a seasoned and stable specialist investment team which has been investing in attractive growth opportunities in environmental markets through diverse market conditions for 20 years. Second, the Fund is based on a vetted investment philosophy which focuses on long-term growth drivers that remain as forceful and diverse as ever.
  • Consensus expectation of earnings growth for the Fund is anticipated to be higher than MSCI ACWI over the next 12 months.X This is a testament to the strength and potential of the companies in the portfolio. The investment team continues to be particularly enthusiastic about the outlook for investments in companies focusing on solutions in Energy Efficiency, Water, Waste and Sustainable Food and Agriculture.


(as of 9/30/18)
1-MonthQuarterYTD1 Year3 Year5 Year10 YearSince Inception1
Global Environmental Markets Fund - Investor Class0.74.55-0.864.3113.357.518.485.95
Global Environmental Markets Fund - Class A˜0.764.55-0.854.3813.367.528.495.96
Global Environmental Markets Fund - Institutional Class0.764.65-0.674.6113.637.778.766.23
MSCI ACWI (Net) Index0.444.283.839.7713.48.678.195.73
FTSE Environmental Opportunities Index Series-0.472.82-0.665.5315.969.159.48-

Performance data quoted represent past performance, which does not guarantee future results. Investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. To obtain performance for the most recent month-end call 800.767.1729 or visit

Figures include reinvested dividends, capital gains distributions, and changes in principal value.

1The inception date for the Pax Global Environmental Markets Fund Institutional Class and the Investor Class is March 27, 2008. The Class A shares inception date is May 1, 2013.

Total annual Global Environmental Markets Fund operating expenses, gross of any fee waivers or reimbursements, for Institutional Class, Investor Class and Class A shares are 1.02%, 1.26%, and 1.26%, respectively, as of 5/1/2018 prospectus. Total annual Global Environmental Markets Fund operating expenses, net of any fee waivers, reimbursements and acquired fund fees and expenses, for Institutional Class, Investor Class, and Class A shares were 0.98%, 1.23% and 1.23%, respectively.

The performance information shown for Class A represents the performance of the Investor Class shares for the period prior to Class A inception. Expenses have not been adjusted to reflect the expenses allocable to Class A shares. Class A inception date return since May 1, 2013 is 9.23% (annualized). A 1.00% CDSC (contingent deferred sales charge) may be charged on any shares sold within 18 months of purchase over $1 million. POP (public offering price) reflects the maximum sales load for the Fund’s Class A Shares of 5.50%.

after sales charge

(as of 9/30/18)
1-MonthQuarterYTD1 Year3 Year5 Year10 YearSince Inception1
Global Environmental Markets Fund - Class A (Load)-4.80-1.18-6.32-1.3811.236.317.885.40

Performance Attribution

Environmental Markets Classification
Systemx Sectors

(as of 9/30/18)
Average Active Weights (%)
Total Relative Contribution (%)

XThe Environmental Markets Classification System (EMCS) is a comprehensive global classification system for environmental markets. Environmental market companies are defined as providing products and services that deliver solutions to environmental challenges, and include environmental technology. Relative results of the Fund compared to the FTSE Environmental Opportunities All Shares Index. Source: FTSE.
Past performance is no guarantee of future results.

Portfolio Characteristics

(as of 9/30/18)
Market Cap (weighted avg.)$24,078M$160,558M
Forward Price/Earnings18.2215.85
Number of Securities462,791


Top Ten Holdings

(as of 9/30/18)
Sealed Air Corp. 4.0%, TE Connectivity, Ltd. 3.4%, Siemens AG 3.4%, Suez 3.3%, Danaher Corp. 3.3%, Ecolab, Inc. 3.1%, Xylem, Inc. 3.1%, East Japan Railway Co. 3.0%, Hubbell, Inc. 3.0% and Ferguson PLC 2.9% Holdings are subject to change.


XEarnings growth is 14% for the Fund and 9% for the MSCI ACWI Index as of 9/30/18. This is a proprietary calculation based on the price-to-earnings last 12 months (P/E LTM) divided by the price-to-earnings over the next 12 months (P/E NTM).
ƒWeighted Average is an average in which each quantity to be averaged is assigned a weight. These weightings determine the relative importance of each quantity on the average.
~Forward Price-Earnings Ratio or P/E FY1 ratio is a ratio for valuing a company that measures its current share price relative to its per-share earnings over the next 12 months.
°Return on Equity: The amount of net income returned as a percentage of shareholders equity. Return on equity measures a corporation’s profitability by revealing how much profit a company generates with the money shareholders have invested.
A historical Beta is used for Funds with greater than 2 years of performance history under the same mandate. Three year Beta is used. Beta reflects the sensitivity of a Fund’s return to fluctuations in its benchmark; a beta for a benchmark is 1.00: a beta greater than 1.00 indicates above average volatility and risk.

The statements and opinions expressed are those of the author as of the date of this report. All information is historical and not indicative of future results and subject to change. This information is not a recommendation to buy or sell any security. Past performance does not guarantee future results.

PAX008247 (1/19)

Hubert Aarts

Deputy CIO, Listed Equities, Executive Director

Hubert serves as Deputy CIO, Listed Equities. He and Bruce Jenkyn-Jones, CIO Listed Equities, are responsible for the development of the investment process, research and team. Hubert researches stocks globally and specialises in Industrials and Consumer Discretionary.

Hubert is Co-Portfolio Manager of Impax’s Leaders and Water strategies. He also leads Impax’s macro-economic research process and is responsible for the top-down investment framework.

Hubert started his career in the investment industry in 1990 and joined Impax in January 2007.  He has extensive experience investing in Pan-European equities as a portfolio manager at MeesPierson and Merrill Lynch Investment Managers, where he chaired the European Sector Strategy Group. Hubert joined Impax from Cambrian Capital Partners LLP where he was a partner and portfolio manager of the Curalium Fund and Incremental Leveraged hedge funds.

Hubert has a Master’s degree in Economics and Business Administration from Maastricht University.

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Bruce Jenkyn-Jones

Chief Investment Officer (CIO), Listed Equities, Executive Director

Bruce serves as Impax’s Chief Investment Officer, Listed Equities. He is responsible for supervising and overseeing investment process, policy and performance, regulatory oversight, and leads product design within Listed Equities and development as well as the application of Impax’s investment thesis across the Listed Equities product range.

Bruce is Chairman of the Listed Equities Investment Committee, and serves as Co-Portfolio Manager of Impax’s Specialists and Climate strategies.

Bruce joined Impax in 1999 where he worked initially on venture capital investments before developing the listed equities business.  Before joining Impax, Bruce worked as a utilities analyst at Bankers Trust and as an environmental consultant for Environmental Resources Management (ERM).

Bruce has an MBA from IESE (Barcelona), an MSc in Environmental Technology from Imperial College and a degree in Chemistry from Oxford.

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David Winborne

Senior Portfolio Manager

David is co-manager of the Global Opportunities, Leaders and US Environmental Leaders strategies. He has global research responsibility and specialises in Energy Efficiency and Pollution Control environmental markets sub-sectors. David researches stocks globally with a focus on the Technology and Telecommunications sectors.

David joined Impax in 2015 from the in-house asset management team at Tesco Pension Investment where he had joint responsibility for the successful development, launch and management of a new global equities investment platform for Tesco’s pension fund. Prior to this David was a fund manager at Sarasin & Partners, where he was responsible for the firm’s Asia-Pacific equity fund and for contributing investment recommendations to Sarasin’s flagship thematic Global Equity fund.

After graduating from the University of Bath, David began his career at Insight Investment on the Global Equities graduate scheme in 2003 as a global equity analyst.

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