Global Quality Equity Fund Update – May

The Insync Global Quality Equity Fund added 2.99% in May, in comparison to a benchmark return of 5.16%. The underperformance during the month was primarily driven by our relative underweights in the U.S. megacap technology sector, particularly Nvidia, where we viewed valuations as excessive and maintained a conservative positioning. Despite ongoing headwinds from U.S. export restrictions impacting sales to China, Nvidia rebounded strongly in May on renewed investor optimism surrounding demand for its advanced AI chips. While our underweight position meant we participated less in the narrow semiconductor-led rally, we continue to maintain a balanced exposure to select U.S. technology companies that are well-positioned to benefit from AI adoption, albeit with more attractive risk-reward profiles. Although the global equity market bounce in May provided some relief, we remain disciplined on valuation, especially in many segments of the U.S. market where expectations leave little margin for error.

Veeva Systems was the largest contributor to Fund performance for the month. The company, which provides an integrated suite of cloud-based software solutions for the life sciences industry, reported another strong set of quarterly results despite a generally cautious macro and regulatory environment. Growth was led by its Commercial segment, particularly its Crossix business, which continues to gain market share. The R&D segment also showed resilience, underpinned by broader customer adoption of adjacent products across Veeva’s platform. The results reinforced the company’s strategic positioning as a vertical SaaS leader, supported by the structural digitalisation of life sciences and the high retention inherent in its platform based delivery model.

More broadly, signs of de-escalation in U.S.–China tensions, a solid U.S. earnings season, and incremental macroeconomic data pointing to resilient growth and contained inflation contributed to reduced volatility across global equity markets in May. The MSCI ACWI ex Australia Index recovered its April losses and delivered a 1.3% gain in AUD terms over the first five months of 2025. For now, so-called “TACO” trades, supported by expectations of limited follow-through on hawkish U.S. trade or policy measures, have continued to underpin market strength. In contrast, bond markets have taken a more cautious stance, with the long end sovereign yields drifting higher across several developed economies including the U.S. and Japan, amid growing concerns over fiscal discipline and the long-term sustainability of public debt trajectories.

We continue to position the portfolio with a disciplined, fundamentals-driven approach, balancing selective exposure to attractively valued U.S. mega-cap names with high-conviction structural growth opportunities outside the U.S. Our focus remains on companies with durable competitive advantages, strong balance sheets, and clear, sustainable paths to long-term earnings growth, as we seek to navigate an increasingly complex and policy-sensitive investment landscape