Interview with Ross Finlayson

Marketing Communication

Investment involves risks. For more information, please refer to the Risk section below.

It feels like there’s a lot of uncertainty in the world right now – with tensions in the Middle East, a resurgence of global tariffs and increased volatility. What should new investors keep in mind when investing for the long-term?

Ross Finlayson: "You’re right, uncertainty is definitely a key factor these days, particularly with policy changes in the US. But even though the US stock market has shown some weakness, other markets, like Europe and some emerging markets (EM), are actually displaying positive signs. So, while we are cautious, we’re not pessimistic."¹

For a while it seemed like everyone wanted a piece of the US stock market. Are you suggesting that is no longer the case?

Ross Finlayson: "While stocks always come with a degree of risk, we believe there are still good opportunities out there for a discerning investor. The key is to be selective. For example, US mid-cap stocks – companies that are medium-sized – might still be worth your attention, as they are generally considered to be less affected by global trade tensions than larger companies.

We also see potential in European companies across sectors supporting European autonomy and infrastructure as governments ramp up spending, partly in response to changing US foreign policies."

What about outside of the US and Europe? Any standouts?

Ross Finlayson: "Yes, Japan is a good example. They’ve introduced reforms that have had a positive impact on the stock market. This could make Japanese stocks, especially more stable, established companies, appealing right now."

And if investors wanted to include bonds in their portfolios for diversification², where should they be looking?

Ross Finlayson: "With bonds, it’s all about watching interest rates while looking out for quality. In Europe, inflation is easing, and the European Central Bank (ECB) is likely to pursue its monetary easing with a potential rate cut by the end of the year. There could be a case for certain Eurozone government bonds, such as those that aim to pay back the original money invested within seven to ten years.³ This is because the price of existing bonds usually rises when rates are cut."⁴

Finally, for any investor just starting out, what would you say to them now?

Ross Finlayson: "I’d say don’t get caught up in short-term market noise. The current global environment is complex, but it also opens doors to new investment opportunities beyond the usual – or sometimes popular – picks. The “leaders” of the past few years might not be the leaders of the next. By spreading your investments across different stocks, bonds, themes and regions you could build a more resilient portfolio."⁵

* Investment involved risks. For more information, please refer to the Risk section below.

¹ Investment involved risks. For more information, please refer to the Risk section below.

² Diversification does not guarantee a profit or protect against a loss.

³ Investment involved risks. For more information, please refer to the Risk section below.

⁴ Past performance is not a reliable indicator of the future ones.

⁵ Investment involved risks. For more information, please refer to the Risk section below.

Key Risks

It is important for potential investors to evaluate the risks described below and in the fund’s Key Information Document (“KID”) and prospectus available on our website www.amundietf.com.

CAPITAL AT RISK - ETFs are tracking instruments. Their risk profile is similar to a direct investment in the underlying index. Investors’ capital is fully at risk and investors may not get back the amount originally invested.

UNDERLYING RISK - The underlying index of an ETF may be complex and volatile. For example, ETFs exposed to Emerging Markets carry a greater risk of potential loss than investment in Developed Markets as they are exposed to a wide range of unpredictable Emerging Market risks.

REPLICATION RISK - The fund’s objectives might not be reached due to unexpected events on the underlying markets which will impact the index calculation and the efficient fund replication.

COUNTERPARTY RISK - Investors are exposed to risks resulting from the use of an OTC swap (over-the-counter) or securities lending with the respective counterparty(-ies). Counterparty(-ies) are credit institution(s) whose name(s) can be found on the fund’s website amundietf.com. In line with the UCITS guidelines, the exposure to the counterparty cannot exceed 10% of the total assets of the fund.

CURRENCY RISK – An ETF may be exposed to currency risk if the ETF is denominated in a currency different to that of the underlying index securities it is tracking. This means that exchange rate fluctuations could have a negative or positive effect on returns.

LIQUIDITY RISK – There is a risk associated with the markets to which the ETF is exposed. The price and the value of investments are linked to the liquidity risk of the underlying index components. Investments can go up or down. In addition, on the secondary market liquidity is provided by registered market makers on the respective stock exchange where the ETF is listed. On exchange, liquidity may be limited as a result of a suspension in the underlying market represented by the underlying index tracked by the ETF; a failure in the systems of one of the relevant stock exchanges, or other market-maker systems; or an abnormal trading situation or event.

VOLATILITY RISK – The ETF is exposed to changes in the volatility patterns of the underlying index relevant markets. The ETF value can change rapidly and unpredictably, and potentially move in a large magnitude, up or down.

CONCENTRATION RISK – Thematic ETFs select stocks or bonds for their portfolio from the original benchmark index. Where selection rules are extensive, it can lead to a more concentrated portfolio where risk is spread over fewer stocks than the original benchmark.

CREDIT WORTHINESS – The investors are exposed to the creditworthiness of the Issuer.

Past performance is not a guarantee or indication of future results.