Performance and Portfolio Update

  • The Pax Global Environmental Markets Fund underperformed the MSCI ACWI in the third quarter. Year-to-date, which includes a strong first half of the year, the Fund remains ahead of MSCI ACWI.
  • Equity markets were again driven by a steady mix of negative and positive economic and geopolitical newsflow. This continued uncertainty led defensive areas of the portfolio, such as Utilities and Health Care sectors, to generate positive returns during the period. Regionally, European portfolio holdings held up the best while US holdings were marked down the most. Overall, portfolio company earnings announcements have been as expected, or better, this year.
  • The biggest headwinds to performance during the quarter came from holdings in Energy Efficiency, particularly Industrial Energy Efficiency. This was due to some negative stock-specific news, but also sentiment driven by concerns about the strength of the global economy, trade war news, or profit taking.
  • Also, detracting during the period were software-related businesses active in the “˜connected factory’ and agricultural technology. PTC (Industrial Energy Efficiency, US) saw slower than expected new subscriptions and weakness in certain non-core geographies resulting in weak quarterly results and pushed out long-term targets. Trimble (Sustainable & Efficient Agriculture, US) suffered from slowing end markets despite good progress on increased software content.
  • Suez (Water Utilities, France) and American Water Works (Water Utilities, US) were top contributors to returns. Suez’s new management team spoke positively about the ability to improve return on capital and cash flow, and thus earnings, at the company. American Water Works benefited from both its status as a defensive holding in a volatile market environment and the decline in long term interest rates.
  • Demonstrating the strength of the Fund’s investment thesis against the backdrop of weaker end markets, Aptiv (Transport Energy Efficiency, US) shares rose with organic growth forecast to be ahead of global automotive market production this year.
  • Market volatility looks likely to continue in the final quarter of the year and into 2020. Shorter-term sector and style rotations are part of equity market moves as investors digest and price in economic data and other news. The investment team continues to take advantage of stock price moves. Portfolio diversification remains important; by theme, end market, catalyst, role in the economic cycle, and region. The team believes the Fund’s defensive tilt within the investable universe is appropriate for these market conditions and should help portfolio resiliency through an unsettled market environment ahead.
  • The portfolio managers believe that recent additions to the portfolio, in areas such as healthy food ingredients, and software technology that enables resource efficiency, position the portfolio to benefit from related thematic drivers. Current valuations are more reasonable, and forward earnings growth for the Fund continues to be projected higher than the MSCI ACWI.


(as of 9/30/19)
Returns (%)Average Annual Returns (%)
1-MonthQuarterYTD1 Year3 Year5 Year10 YearSince Inception1
Global Environmental Markets Fund - Investor Class2.92-2.1417.491.547.607.068.215.56
Global Environmental Markets Fund - Class A2.92-2.1517.431.477.617.048.215.56
Global Environmental Markets Fund - Institutional Class2.96-2.0717.731.737.877.328.485.83
MSCI ACWI (Net) Index2.10-0.0316.201.389.716.658.355.34
FTSE Environmental Opportunities Index Series3.450.0019.585.2111.068.709.40-

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 0.99%, 1.24%, and 1.24%, respectively, as of 5/1/2019 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 0.99%, 1.24% and 1.24%, 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 7.98% (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%.


(as of 9/30/19)
Returns (%)Average Annual Returns (%)
1-MonthQuarterYTD1 Year3 Year5 Year10 YearSince Inception1
Global Environmental Markets Fund - Class A (Load)-2.76-7.5210.98-4.105.605.837.605.05

Performance Attribution

Global Industry Classification Standard Sectors

(for quarter ended 9/30/19)
Average Active Weights (%)
Total Relative Contribution (%)

The Global Industry Classification Standard (GICS) is a standardized classification system for equities developed jointly by Morgan Stanley Capital International (MSCI) and Standard & Poor’s. The GICS methodology is used by the MSCI indexes, which include domestic and international stocks, as well as by a large portion of the professional investment management community.
Past performance is no guarantee of future results.

Performance Attribution

Environmental Markets Classification
Systemx Sectors

(for quarter ended 9/30/19)
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 9/30/19)
Market Cap (weighted avg.)$26,197M$163,267M
Forward Price/Earnings17.3316.13
Number of Securities492,849


Top 10 Holdings

(as of 9/30/19)
Linde PLC 3.7%, Waste Management, Inc. 3.6%, Schneider Electric SE 3.5%, Siemens AG 3.4%, Suez 3.3%, Agilent Technologies, Inc. 3.1%, Xylem, Inc. 3.0%, TE Connectivity, Ltd. 3.0%, East Japan Railway Co. 3.0% and Ingersoll-Rand PLC 3.0%. Holdings are subject to change.


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 two 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.

PAX008818 (1/20)

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.

Recent Insights

Additional Insights

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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