Swiss Small & Mid Cap Fund Class A zMonthly October 20

Second wave takes markets by surprise Performance since Launch (as of 30/10/2020) Equity markets enjoyed a healthy start to the closing quarter of the year. However, US President Donald Trump caused market jitters following his stay in hospital with COVID-19 when he in- structed the Republicans with a tweet to break off talks on an- other fiscal package. A short while later, he stated that he was once again open to a swift conclusion. The US elections subse- quently became one of the dominant themes, as the possibility of a “blue sweep” – with the Democrats taking control of the White House, Senate and House of Representatives – fuelled hopes for more aggressive fiscal policy and led share prices to zCapital Swiss Small & Mid Cap Fund A SPI Extra® (indexed) rally. From the middle of the month, the second wave of the pandemic began to spread across Europe. Tighter restrictions Performance (as of 30/10/2020) on movement and fresh lockdowns are now in force in several countries. The economic recovery is therefore likely to be MTD (Fund / Benchmark) -4.0% / -4.7% weaker than expected in the fourth quarter. European markets YTD -2.5% / -5.4% consequently slipped back to their June levels. As in spring, 1 year 2.4% / 0.3% this also dragged US markets lower. Logitech shares climbed to 3 years p.a. 2.8% / 1.3% a new all-time high on the back of the company’s quarterly re- 5 years p.a. 9.7% / 8.4% sults, which showed that sales of computer peripherals sky- 10 years p.a. 9.7% / 8.2% rocketed over the summer. Julius Baer impressed with an en- Since launch p.a. 11.0% / 8.4% couraging nine-month update. Growth at the bank has acceler- ated, and costs are under control. The fund shed 4.0% in Octo- Sectors (as of 30/10/2020) ber (SPI Extra -4.7%).

Little need for action Our cautious positioning paid off in the month under review. Accordingly, there was little need for us to take action. We re- duced the weighting in Cembra Money Bank, Georg Fischer, Forbo and Barry Callebaut. At the same time, we increased our exposures in Julius Baer, Bucher Industries, Sonova and Strau- mann slightly.

Another economic downturn? The pace and momentum of the second wave of the pandemic caught market participants off guard. The associated uncer- tainty is toxic to the economy, with consumer spending likely to soften again and the corporate sector expected to continue cut- Largest Positions (as of 30/10/2020) ting or shelving investment. Structural adjustment is set to ac- celerate across a raft of sectors. A hard winter is likely to be in 1 Lindt & Sprüngli 6.1% store for parts of the economy in Europe and the US. The situ- 2 Logitech 5.9% ation in Asia, however, looks more favourable thanks to the ex- 3 Schindler 5.2% tremely systematic way in which the pandemic has been tack- 4 Julius Baer 4.0% led. Companies with a significant portion of their sales in China 5 Sonova 3.7% are likely to be beneficiaries. The US elections will feature heav- 6 Baloise 3.4% ily over the next few days. There is huge uncertainty about the 7 PSP Swiss Property 2.9% outcome, and markets are likely to experience additional vola- 8 Straumann 2.9% tility. There is a strong chance that it will take several days be- 9 Kühne + Nagel 2.7% fore the definitive official results are announced. Markets will be 10 Sunrise 2.6% able to live with any configuration except the election of a Dem- 11 Temenos 2.4% ocrat President Joe Biden and a continued, Republican-domi- 12 SIG Combibloc 2.3% nated Senate. In addition, investors are pinning their hopes on a 13 BKW 2.2% major stimulus package, support from monetary policy and an 14 Barry Callebaut 2.1% imminent vaccine. 15 EMS-Chemie 2.0%

zCapital AG Baarerstrasse 82 6300 Zug T + 41 41 729 80 80 www.zcapital.ch

Investment Strategy Portfolio Structure (as of 30/10/2020) The zCapital Swiss Small & Mid Cap Fund invests in Swiss Net Asset Value CHF 3,496.27 per Share A small and mid-cap stocks and measures itself against the SPI Total Assets CHF 938 m Extra® (all SPI® stocks without SMI® or without the 20 Investment Exposure 90.1% largest securities). The fund assets are invested in a broadly Number of Companies 56 diversified portfolio of 50 to 70 companies. zCapital strives to consistently exceed the benchmark return with a long-term, Statistics 3 Years (as of 30/10/2020) active investment style. Investment decisions are based on Volatility Fund / Index p.a. 15.4% / 16.4% fundamental company analyses, considering and assessing Tracking Error 2.1% corporate governance and other key ESG aspects. Macroeco- Information Ratio 0.6 nomic factors are also included in the decision-making pro- cess.

Termsheet Fund-Name zCapital Swiss Small & Mid Cap Fund (Class A) Asset Manager zCapital AG, Zug Swiss Security Number / ISIN 4534164 / CH0045341648 Price Publications www.zcapital.ch, www.swissfunddata.ch, www.fundinfo.com Bloomberg / Reuters ZCAPSWI SW Equity / 4534164.S Benchmark SPI Extra® (Swiss small & mid cap equities) Morningstar-Rating Minimum Investment / Reference Currency No minimum investment required / CHF Fund Type / Distribution Swiss Securities Fund / Authorized for public distribution in Switzerland and Germany Fund Management Company / Custodian Bank LLB Swiss Investment AG, Zürich / Bank Julius Bär & Co. AG, Zürich Management Fee 1.5% p.a., of which 0.1% donated to charities which engage in "Children and Education" (incl. Fund Management and Custodian Fees) Issue Fee / Redemption Fee None / 0.4% in favour of the fund Total Expense Ratio (TER) as of 31/05/2020 1.51% Soft Closing The investment strategy of the Fund is capacity constrained. Therefore, the Fund is currently closed for new investors. Subscriptions and Redemptions On each bank working day at Net Asset Value (NAV). Subscriptions and redemptions which are placed with the Custodian Bank by 3.45 pm CET on a bank business day (Order Day), are processed on the next bank working day (Valuation Day) based on the Order Day’s closing price. Auditor PricewaterhouseCoopers AG, Zurich

Yearly Performance (as of 30/10/2020)

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Fund -14.5% 40.2% 23.4% -18.4% 17.8% 26.0% 15.2% 12.8% 9.3% 29.0% -14.4% 28.7% -2.5% SPI Extra® -18.5% 29.6% 20.1% -19.1% 13.9% 27.7% 11.4% 11.0% 8.5% 29.7% -17.2% 30.4% -5.4%

Monthly Performance (as of 30/10/2020) 2020 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Year Fund 0.4% -7.4% -9.8% 5.7% 5.9% 2.1% 0.5% 4.6% 0.7% -4.0% -2.5% SPI Extra® 0.0% -7.9% -11.5% 6.2% 6.5% 1.3% 0.6% 5.6% 0.2% -4.7% -5.4%

This document is promotion material. This document of zCapital Ltd does not constitute an offer or recommendation for the purchase or sale of investment funds. The information herein is subject to change at any time. No liability is accepted for any incorrect information. Past performance is not a reliable indicator of current or future performance. The performance figures do not include commissions and costs, which arise at subscription and redemption of units. According to Swiss law, the zCapital Swiss Small & Mid Cap Fund falls into the category of “Securities Fund”. Investors are advised of the risks described in the fund prospectus. Investors have to be prepared to accept and be in a financial position to bear (possibly substantial) losses. The legal fund documents are available free of charge from zCapital Ltd, Baarerstrasse 82, 6300 Zug, Switzerland or on the website www.zcapital.ch. With respect to any sales restrictions, investors should seek independent advice on the applicable legal, financial or tax principles in the country concerned. This document is not intended for natural persons or legal entities for whom the use would breach the legal system of their state on account of their nationality or the domicile of the respective person or for other reasons. This applies in particular to persons with residence or domicile in the USA, Great Britain and Japan.