Webinars and video updates

Global Focused Growth Equity Strategy | Q2 2026 Review

Market Environment

The second quarter of 2026 was defined by AI infrastructure strength, easing geopolitical risk, and a market focused on companies with the strongest earnings revisions. The moderation of the Iran-related oil shock reduced inflation and rate concerns, while the economy remained resilient and AI demand strengthened.

AI remains the dominant force shaping global equities. Token volumes are expanding, unit costs are falling, use cases are emerging, and hyperscalers continue to seek more scale, speed, power, and efficiency. A supply chain built for smartphones and cloud servers is absorbing extraordinary demand for AI compute, creating bottlenecks across memory, optics, power, cooling, and data center infrastructure.

This creates both opportunity and risk. We believe the portfolio remains positioned in areas where relative returns are improving most, while price momentum and valuation discipline have become more important as the cycle advances. The challenge is to manage position size, cycle duration, and earnings risk.

Portfolio Positioning

The portfolio remains grounded in the Global Focused Growth investment framework: seeking quality businesses with improving economic returns at a reasonable valuation. The second quarter was consistent with that investment framework across areas where earnings revisions and returns improved most quickly.

AI infrastructure exposure remained broad across industries and geographies. The portfolio benefited from underweights to much of the Mag 7 group of stocks and hyperscaler platforms, using those weights to fund companies receiving AI-related cash flows rather than companies spending heavily to stay in the race.

Regionally, the underweight to the U.S. reflects the opportunity set outside the U.S., not a negative U.S. view. Taiwan, Korea, Japan, and select China-related companies offer meaningful AI infrastructure exposure. Emerging markets exposure is increasingly tied to AI, particularly Korea and Taiwan.

We also broadened the portfolio by adding diversifying AI exposure that still meets our framework. Linde, Southern Company, UnitedHealth Group, and Stryker were not defensive trades; they were efforts to play offense where quality, valuation, and improving returns look attractive. Within AI, we trimmed contributors and recycled capital into newer bottlenecks such as MLCCs [Multi-Layer Ceramic Capacitors] and components tied to data center power density.

Performance

Second quarter performance was strong and reflected broad contribution from AI infrastructure rather than reliance on a single stock or market rally. Some of the contributors included SK Hynix, Samsung Electronics, Micron, Zhongji Innolight, Tokyo Electron, Infineon, Vicor, Vertiv, and Snowflake. 

Memory was a major source of strength, particularly high bandwidth memory, where demand is tied directly to AI workloads. Optics, power, and cooling also benefited from rising data center scale and density. The portfolio also benefited from being underweight Microsoft, highlighting the distinction between companies funding the AI build-out and those receiving the associated cash flows.

Detractors were more about timing, crowding out, and relative underperformance than broad thesis deterioration though we continue to monitor company-specific fundamentals. Energy pain after the Iran crisis cooled and oil-related equities sold off, though it had previously served as a diversifier and inflation hedge. Financials were mixed, with developed market banks performing well, while exchanges and payments-related names remained pressured.

Outlook

We remain constructive on AI infrastructure and see it as a significant source of improving relative returns in global equities. The cycle appears larger and more durable than prior technology cycles because it is tied to the scaling of intelligence itself. Physical supply remains constrained, demand continues to grow, and hyperscalers appear willing to expand balance sheets to fund the build-out.

At the same time, risk management is becoming more important. Identifying AI was the easier part; managing valuation, momentum, concentration, and cycle duration is now the harder task. The main risks are LLM [large language model] regulation, inflation, and rates. Restrictions on model releases could disrupt scaling laws, while stronger growth and AI-related capital spending could keep inflation elevated and limit U.S. Federal Reserve cuts.

Against this backdrop, we do not think the right response is to call the end of the AI cycle or move aggressively risk-off. We continue to believe the AI infrastructure names we own have further upside, but we are spending more time on portfolio balance. The goal is to preserve alpha, maintain exposure to the strongest structural growth opportunity in the market, and add diversified sources of improving relative returns outside AI.

For investment professionals only. Not for further distribution.

Objective

The Global Focused Growth Equity Composite seeks long-term capital appreciation primarily through investment in established companies operating in developed markets throughout the world, with faster earnings growth and reasonable valuation levels relative to market/sector averages. Further, the strategy seeks to buy companies where there is insight about improving economic returns of the business that are not fully reflected in their valuation. (Created June 2006; incepted January 31, 1996) (Formerly known as Global Equity Composite)

Risks – the following risks are materially relevant to the portfolio: • Currency – Currency exchange rate movements could reduce investment gains or increase investment losses. • Emerging Markets – Emerging markets are less established than developed markets and therefore involve higher risks. • Equity – Equities can lose value rapidly for a variety of reasons and can remain at low prices indefinitely.  • Geographic concentration – Geographic concentration risk may result in performance being more strongly affected by any social, political, economic, environmental or market conditions affecting those countries or regions in which the portfolio's assets are concentrated.  • Security liquidity – Any security could become hard to value or to sell at a desired time and price. • Small and mid-cap – Small and mid-size company stock prices can be more volatile than stock prices of larger companies. • Style – Style risk may impact performance as different investment styles go in and out of favor depending on market conditions and investor sentiment.

General Portfolio Risks

• Conflicts of Interest – The investment manager's obligations to a portfolio may potentially conflict with its obligations to other investment portfolios it manages. • Counterparty – Counterparty risk may materialise if an entity with which the portfolio does business becomes unwilling or unable to meet its obligations to the portfolio. • Custody – In the event that the depositary and/or custodian becomes insolvent or otherwise fails, there may be a risk of loss or delay in return of certain portfolio's assets. • Cybersecurity – The portfolio may be subject to operational and information security risks resulting from breaches in cybersecurity of the digital information systems of the portfolio or its third-party service providers. • ESG – Environmental, social or governance event(s) or condition(s) may occur, which could have/result in a material negative impact on the value of an investment and performance of the portfolio. • Investment portfolio – Investing in portfolios involves certain risks an investor would not face if investing in markets directly. • Inflation – Inflation may erode the value of the portfolio and its investments in real terms. • Market – Market risk may subject the portfolio to experience losses caused by unexpected changes in a wide variety of factors. • Market liquidity – In extreme market conditions it may be difficult to sell the portfolio's securities and it may not be possible to redeem at short notice. • Operational – Operational risk may cause losses as a result of incidents caused by people, systems, and/or processes. • Sustainability – Portfolios that seek to promote environmental and/or social characteristics may not or only partially succeed in doing so. 

Hello, and welcome to the T. Rowe Price Funds SICAV - Diversified Income Bond Fund.

First, a quick reminder of what the fund is all about.

We like to describe it as a one-stop fixed income solution. We actively manage all parts of fixed income, globally, with the aim of delivering both attractive income and total return.

The team draws on our global fixed income platform and the best ideas across 15 major global fixed income sectors. We select the strongest opportunities from across the platform, while actively managing credit risk, interest-rate risk and currency risk.

Let's start with the level of income the fund is generating today, and how sustainable that income is.

As at 30 June, the fund's income distribution was 7.2%, and that level has been sustained for some time. Its important to note that whilst attractive stable income is a target of ours

we are not generating it simply by reaching for the riskiest assets in the market. In fact, the fund will remain investment-grade quality on average at all times.

The income comes from a diversified mix of high yield credit, investment grade credit, emerging market debt, currencies and selected idiosyncratic opportunities. That means the fund is not overly dependent on one market, one region or one source of return.

The income profile is supported by a broad global opportunity set and an active investment process.

The second quarter was shaped by three big themes.

First, the Middle East conflict added volatility to energy markets and kept inflation risks in focus.

Second, the US economy remained resilient versus others. Growth was strong enough to keep the 'US exceptionalism' theme alive.

And third, central banks stayed cautious, with inflation still front and centre. The ECB responded by raising rates, while the much-anticipated new Fed chair, Kevin Warsh, struck a more hawkish tone. That reinforced the idea that rates could stay higher for longer. We saw a similar shift in the UK, where markets had gone into Q2 expecting several rate cuts but ended up pricing in a much more aggressive path for rates.

So, this was not an easy backdrop: geopolitical risk, strong US growth, inflation concerns and pressure on rates.

Against that environment, the Diversified Income Bond Fund delivered a strong quarter, returning 2.9 compared to the global aggregate bond index 1.3%.

The main contributors were our allocations to high yield, investment grade credit and emerging market debt. Despite an early sell-off as the Iran conflict emerged, markets remained resilient and generally quickly recovered. Some of our holdings largely avoided the volatility altogether. Names like Africell and Axian Telecom performed particularly well.

FX was also a positive. That came from selected emerging market currencies, including the Egyptian pound and the Brazilian real. We also actively managed the US dollar, moving from a net short position to a small net long by the end of June, driven by relative US yields and the continued strength of the US economy.

Rates were broadly neutral. We maintained the  underweight duration position  for the quarter, but added modestly to US duration at the end of June after the market had repriced US rates higher, especially at the front end of the curve.

Looking ahead, we still see opportunities, but we are being selective.

Valuations across markets are generally not cheap. Credit spreads have tightened, and investors are not being paid as much as they were for broad credit risk.

So, our positioning is all about balance.

We have moved tactically long the US dollar.

We have increased duration marginally.

We have continued to reduce credit risk.

And we are actively looking for relative-value opportunities across countries, currencies, sectors and issuers.

During the quarter, we added inflation protection through five-year TIPS, reduced or exited selected country exposures, including Colombia, Turkey and Sri Lanka, and used credit protection and options where we thought they improved the portfolio's risk-reward profile.

The aim is clear: maintain attractive income, while keeping enough flexibility to manage risk and take advantage of opportunities.

A good example was our purchase of FABSJV 35s, which are bonds issued by Foundry JV Holdco - a semiconductor fabrication joint venture between Intel and Brookfield. Our analysts spotted an opportunity in the issuance versus others coming to market, tied to the growth in AI-related capital spending. The trade worked well as demand for data centres and computing infrastructure picked up. We took some profits and continue to look for similar opportunities across the AI capex theme.

So why the Diversified Income Bond Fund, and why now?

Yields are attractive, and there are still opportunities out there - but you need to think globally and you need to be active.

Income is available, but valuations are not cheap everywhere. Rates are still volatile. Inflation risk remains. Geopolitics can move markets quickly. And credit selection matters.

The Diversified Income Bond Fund gives clients a one-stop fixed income solution: global, diversified, active and income-focused. We manage the risks while seeking fixed income opportunities around the world.

Risks – the following risks are materially relevant to the fund (refer to prospectus for further details):

• ABS and MBS—​Asset-Backed Securities (ABS) and Mortgage-Backed Securities (MBS) may be subject to greater liquidity, credit, default and interest rate risk compared to other bonds. They are often exposed to extension and prepayment risk.
• Contingent convertible bond—​Contingent Convertible Bonds may be subject to additional risks linked to: capital structure inversion, trigger levels, coupon cancellations, call extensions, yield/valuation, conversions, write downs, industry concentration and liquidity, among others.
• Credit—Credit risk arises when an issuer's financial health deteriorates and/or it fails to fulfill its financial obligations to the fund.
• Currency—​Currency exchange rate movements could reduce investment gains or increase investment losses.
• Default—Default risk may occur if the issuers of certain bonds become unable or unwilling to make payments on their bonds.
• Derivative—Derivatives may be used to create leverage which could expose the fund to higher volatility and/or losses that are significantly greater than the cost of the derivative.
• Emerging markets—Emerging markets are less established than developed markets and therefore involve higher risks.
• Geographic concentration—​Geographic concentration risk may result in performance being more strongly affected by any social, political, economic, environmental or market conditions affecting those countries or regions in which the fund's assets are concentrated.
• Hedging—Hedging measures involve costs and may work imperfectly, may not be feasible at times, or may fail completely.
• High yield bond—​High yield debt securities are generally subject to greater risk of issuer debt restructuring or default, higher liquidity risk and greater sensitivity to market conditions.
• Interest rate—Interest rate risk is the potential for losses in fixed-income investments as a result of unexpected changes in interest rates.
• Issuer concentration—Issuer concentration risk may result in performance being more strongly affected by any business, industry, economic, financial or market conditions affecting those issuers in which the fund's assets are concentrated.
• Security Liquidity—Any security could become hard to value or to sell at a desired time and price.
• Prepayment and extension—Mortgage- and asset-backed securities could increase the fund's sensitivity to unexpected changes in interest rates.
• Real estate—Real estate and related investments can be hurt by any factor that makes an area or individual property less valuable.
• Sector concentration—Sector concentration risk may result in performance being more strongly affected by any business, industry, economic, financial or market conditions affecting a particular sector in which the fund's assets are concentrated.
• Total Return Swap—Total return swap contracts may expose the fund to additional risks, including market, counterparty and operational risks as well as risks linked to the use

General Fund Risk

• Conflict of interest—The investment manager's obligations to a fund may potentially conflict with its obligations to other investment portfolios it manages.
• Counterparty—Counterparty risk may materialise if an entity with which the fund does business becomes unwilling or unable to meet its obligations to the fund
• Custody—In the event that the depositary and/or custodian becomes insolvent or otherwise fails, there may be a risk of loss or delay in return of certain fund's assets.
• Cybersecurity—the fund may be subject to operational and information security risks resulting from breaches in cybersecurity of the digital information systems of the fund or its third-party service providers.
• ESG—Environmental, social or governance event(s) or condition(s) may occur, which could have/result in a material negative impact on the value of an investment and performance of the fund.
• Investment fund - Investing in funds involves certain risks an investor would not face if investing in markets directly.
• Inflation—Inflation may erode the value of the fund and its investments in real terms.
• Market—Market risk may subject the fund to experience losses caused by unexpected changes in a wide variety of factors.
• Market liquidity—In extreme market conditions it may be difficult to sell the fund's securities and it may not be possible to redeem shares at short notice.
• Operational—Operational risk may cause losses as a result of incidents caused by people, systems, and/or processes.
• Sustainability—Funds that seek to promote environmental and/or social characteristics may not or only partially succeed in doing so.

Emerging Markets Discovery Equity Fund – Q2 2026 Quarterly Highlights

Hi everyone, and thank you for joining me. I’m Robert Secker, Portfolio Specialist for our T. Rowe Price Funds SICAV - Emerging Markets Discovery Equity Fund.

In this update, I'd like to share three key takeaways from the second quarter and why we continue to see attractive opportunities across emerging markets.

As a quick reminder, the fund is designed to provide clients with a differentiated source of alpha. We achieve this by being deliberately contrarian, not by style but by targeting stocks that we determine are forgotten - overlooked by others. The result of this approach is a portfolio that is highly differentiated versus the market and peers.

First takeaway: Emerging markets are continuing to deliver

Despite ongoing geopolitical tensions and commodity price volatility, emerging market equities delivered another strong quarter. Albeit performance was rather narrow with technology driving most gains. Consequently, South Korea and Taiwan were the standouts, where continued investment in artificial intelligence is driving record earnings growth across the semiconductor supply chain.

China underperformed, largely due to the index construction, which is dominated by consumer, internet related names. China’s AI stocks ran strongly but they are a very small part of the index. Latin America lagged as commodity and energy stocks gave back some of their earlier gains.

Second takeaway: Our differentiated approach continues to uncover value

Although the portfolio modestly lagged the benchmark during the quarter, it continued to generate strong absolute returns and has outperformed the MSCI Emerging Markets and MSCI Emerging Markets Value Index Net indices over the past year.

Some of our strongest contributors came from investments in the AI supply chain, including MediaTek, SK Hynix, Samsung Electronics and ASE Technology, which benefited from continued demand for AI infrastructure. Given the incredibly strong momentum in the memory sector we’ve been taking profits this year reducing our overweights

There were also some detractors across industrial, energy and consumer-related holdings. However, our investment philosophy remains unchanged. Rather than chasing the market's most crowded trades, we remain focused on identifying under-researched companies with improving fundamentals and clear catalysts for long-term value creation.

Lastly: We remain constructive on the outlook

Looking ahead, we continue to see an attractive backdrop for emerging markets.

The long-term structural drivers – including AI investment, supply chain realignment, re-industrialization of the West and energy transition spending – continue to generate earnings growth and opportunities across the entire EM universe.

Earnings growth is very strong, valuations are attractive relative to developed markets and positioning is light, most investors remain underweight EM.

At the same time, benchmark indices are becoming increasingly concentrated in a relatively small number of technology stocks. We believe this creates an even stronger environment for our differentiated, contrarian approach, allowing us to uncover high-quality businesses that the broader market may be overlooking.

Our focus remains firmly on finding these "forgotten" companies – businesses with improving fundamentals, attractive valuations and the potential to deliver long-term value for investors.

Thank you for watching, and we look forward to updating you again next quarter.

Risks—the following risks are materially relevant to the fund (refer to prospectus for further details):

Country (China) – Chinese investments may be subject to higher levels of risks such as liquidity, currency, regulatory and legal risks due to the structure of the local market.

Country (Russia and Ukraine) – Russian and Ukrainian investments may be subject to higher risks associated with custody and counterparties, liquidity, market disruptions, as well as strong or sudden political risks.

Currency – Currency exchange rate movements could reduce investment gains or increase investment losses.

Emerging markets – Emerging markets are less established than developed markets and therefore involve higher risks.

Equity – Equities can lose value rapidly for a variety of reasons and can remain at low prices indefinitely.

Geographic concentration – Geographic concentration risk may result in performance being more strongly affected by any social, political, economic, environmental or market conditions affecting those countries or regions in which the fund's assets are concentrated.

Small and mid-cap – Small and mid-size company stock prices can be more volatile than stock prices of larger companies.

Style – Style risk may impact performance as different investment styles go in and out of favor depending on market conditions and investor sentiment.

General Fund Risks

Conflicts of Interest – The investment manager's obligations to a fund may potentially conflict with its obligations to other investment portfolios it manages.

Counterparty – Counterparty risk may materialise if an entity with which the fund does business becomes unwilling or unable to meet its obligations to the fund.

Custody – In the event that the depositary and/or custodian becomes insolvent or otherwise fails, there may be a risk of loss or delay in return of certain fund’s assets.

Cybersecurity – The fund may be subject to operational and information security risks resulting from breaches in cybersecurity of the digital information systems of the fund or its third-party service providers.

ESG – Environmental, social or governance event(s) or condition(s) may occur, which could have/result in a material negative impact on the value of an investment and performance of the fund.

Inflation – Inflation may erode the value of the fund and its investments in real terms.

Investment fund – Investing in funds involves certain risks an investor would not face if investing in markets directly.

Market – Market risk may subject the fund to experience losses caused by unexpected changes in a wide variety of factors.

Market Liquidity – In extreme market conditions it may be difficult to sell the fund's securities and it may not be possible to redeem shares at short notice.

Operational – Operational risk may cause losses as a result of incidents caused by people, systems, and/or processes.

Sustainability – Funds that seek to promote environmental and/or social characteristics may not or only partially succeed in doing so.

The specific securities identified and described do not represent all of the securities purchased, sold, or recommended for the portfolio, and no assumptions should be made that the securities identified and discussed were or will be profitable.

Market Environment

The first quarter of 2026 was defined by sharp rotations, elevated geopolitical tension, and meaningful quarter-end noise. The final trading day of the period had an outsized effect on reported relative returns, masking what we view as improving performance beneath the surface. More importantly, the quarter reinforced our conviction that artificial intelligence remains the dominant force shaping global equity markets, with investment broadening beyond semiconductors into power, optical components, data center infrastructure, construction, and industrial capacity.

That backdrop is expanding the opportunity set for active management. Benchmark concentration remains high, but the list of companies seeing improving economic returns is widening across sectors, geographies, and market-cap tiers. At the same time, rising capital intensity at some mega-cap platforms and faster AI-driven disruption in software and services are creating a more discriminating market environment. In our view, this is increasingly rewarding companies on the right side of structural change while placing pressure on businesses whose economics rely on aging barriers to entry.

Portfolio Positioning

The portfolio remains grounded in our Global Focused Growth Equity framework: quality businesses where research uncovers differentiated insight into improving economic returns. That framework continues to pull us toward a broader set of AI infrastructure beneficiaries, physical-world enablers, and selected cyclical and defensive holdings where the market may be underestimating the duration or breadth of improvement. We remain underweight much of the MAG7 outside of NVIDIA, while viewing Google as our preferred exposure among the largest hyperscaler platform companies.

During the quarter, we reallocated within major themes rather than stepping away from them. In AI infrastructure, we reduced concentrated DRAM exposure following strong gains and recycled capital into optical and other supply-chain beneficiaries to improve diversification and risk-adjusted return potential. We also increased and reshaped energy exposure as geopolitical risk rose, building a more balanced mix across upstream, refining, and natural gas. Regionally, we reduced India and some broader emerging market exposure, added to select Taiwan and China AI infrastructure beneficiaries, increased North America through U.S. energy and AI infrastructure, and continued to add selectively to defense and carefully contrarian opportunities in Europe.

Performance

Reported quarter-end performance understated the portfolio's path through the period, as the final trading day had an outsized impact on relative results. Even so, we were encouraged by the strategy's resilience in a market that sharply favored value over growth. We believe that outcome reflects the portfolio's focus on company-specific fundamentals and improving returns rather than simple factor exposure.

Stock selection in technology, industrials, and cyclicals was a source of strength. Contributors included Delta Electronics, Samsung, SK Hynix, TSMC, BE Semiconductor Industries, Teledyne, and Teradyne, highlighting the breadth of AI infrastructure beneficiaries across regions and end markets.Consumer discretionary and selected health care positions were weaker, while we also used the quarter to refine exposures in areas such as GLP-1, financials, and carefully contrarian holdings where recent valuation compression may be creating future opportunity.

Outlook

We continue to see AI infrastructure as one of the strongest sources of improving relative returns in global equities and expect a sustained capex cycle over the next several years to keep demand tight in power, optical, networking, PCB [printed circuit boards], memory, and semi-cap bottlenecks. The Iran-related oil shock has narrowed the path to rate cuts and raised inflation and recession risk, but if oil settles into a higher yet manageable range, we believe the portfolio can work through it, whereas a deeper shock would pressure even the best AI infrastructure names and require us to lean more heavily on our energy hedges. Against this backdrop, we are focusing on companies where incremental capital earns higher returns and where the market underestimates the durability of growth. In our view, the right response to a volatile environment is not to dilute our framework, but to tighten the portfolio around improving relative returns, strong earnings-revision potential, and real pricing power.

Hi, I’m Amanda Stitt, Portfolio Specialist for the Diversified Income Bond Fund. Thanks for joining me for our Q1 2026 update.

I’ll start with a quick look at markets, then move on to what we did in the portfolio and how the fund performed.

Coming into the year, we had a constructive view. Growth looked solid globally, particularly in the US, and we expected some divergence in central bank policy. Credit markets were well supported, with strong demand for income, so overall it felt like a good environment for carry strategies.

But Q1 turned out to be more volatile than expected.

Government bond markets were a big driver of that. We saw a rally mid quarter as inflation trends eased but that reversed quite sharply in March as the escalation of the Iran conflict pushed energy prices higher and reignited inflation concerns. Yields moved up across developed markets.The UK gilt market was a standout, with extreme volatility in March, reflecting both global pressures and domestic sensitivity to inflation and policy expectations.

Credit markets also had a tougher quarter. Spreads tightened early on, but then widened through February and more meaningfully in March. The move was more pronounced in high yield, while investment grade was more resilient. Importantly, cash bonds held up relatively well, with more of the volatility concentrated in synthetic markets as investors chose to hedge rather than sell.

In emerging markets, returns were positive through the first part of the quarter before reversing sharply in March.

But dispersion was again the name of the gameIn FX, the US dollar strengthened on safe-haven demand later in the quarter, although the move wasn’t fully sustained and was partly driven by positioning.Turning to the portfolio—We started with relatively low interest rate exposure, with duration below two years. That helped as yields rose. As we moved through March and yields became more attractive, we increased duration across the US, UK and Europe, ending the quarter just under three years.

In emerging markets, we rotated positions—taking profits in areas that held up well and reallocating into markets offering better entry points after the sell-off.We added to TIPS as higher inflation improved carry and provided a useful hedge. We reduced some cash investment grade credit and used synthetic markets more actively. Added to sovereigns and securitised assets where valuations looked more attractive.

In currencies, we reduced our short US dollar position and adjusted a number of emerging market exposures including TRY, INR and added NGN which proved robust as an oil exporter .Now turning to performance—The fund was down around 40 basis points over the quarter, compared to the Global Aggregate, which was down about 15.

The main driver of underperformance was credit exposure, particularly high yield and emerging markets, as spreads widened our longer risk position was penalised On the positive side, duration positioning helped, with our underweight to rates—especially in the US, eurozone, Japan and Poland—offsetting some of the losses as yields rose.

Currency was a modest detractor overall, with some EM FX positions under pressure as risk sentiment weakened.

So overall, it was really a quarter where our pro-risk positioning in credit weighed on returns, while our defensive stance on rates helped balance that out.

Importantly, we remain ahead of the benchmark over the full year.

Looking ahead—We’re not trying to take a directional view on how the conflict evolves. Instead, we’re focused on relative value opportunities.

The near-term outlook for inflation and growth is clearly more uncertain given the energy shock, but we still see longer-term support for global growth. The US in particular remains resilient, with a stable labour market and a healthy corporate backdrop, as reflected in the current earnings season.

From a policy perspective, central banks are likely to remain cautious in the near term, particularly given the uncertainty around inflation. But absent a re-acceleration in core inflation, there is still scope for easing later in the year.

In credit, while spreads have widened, fundamentals remain solid and demand for yield is still strong. So we remain broadly constructive, but increasingly selective as dispersion increases.

We also see inflation-linked bonds as a useful hedge in the current environment, particularly given the risk of further energy-driven inflation spikes.So to summarise: over the quarter we increased duration following the March sell-off, added selectively to credit, increased inflation hedges, and reduced our short dollar.

And more broadly, the key strength of this fund is its flexibility—we can adjust positioning as markets evolve and take advantage of dislocations like the ones we saw this quarter. We can avoid both credit and interest rate risk as well as take advantage of volatility. Our flexibility is the key to successfully navigating volatile markets Thanks for listening, and I look forward to speaking with you again next quarter.