Marcel Fritsch from Bellevue AM – Fund Manager of the Month

Marcel Fritsch joined Bellevue Asset Management in 2008 as portfolio manager of the  BB Adamant Medtech & Services and BB Adamant Digital Health Fund. Prior to that, he spent more than 3 years as a consultant with Deloitte & Touche. Formulating company strategy, evaluating organizational structures and valuing companies prior to corporate transactions were among his duties in this function. Marcel Fritsch holds a degree in business economics from the University of St. Gallen (HSG).

1. When and how did you start your career in the financial industry? What brought you to the financial sector?

After graduating from the University of St.Gallen, I worked more than 3 years as consultant at Deloitte. In the course of my consulting career, I increasingly was exposed to health care industry with projects in Medtech, Pharmaceutical, and Diagnostics companies. Based on my health care expertise, I joined Bellevue in 2008 as equity analyst for medical technology companies.

2. How does your work on a daily basis look like and what kind of problems do you normally face as a Portfolio Manager? What brought you to focus your job as a Portfolio manager on medical technology & healthcare services?

Days can look very differently. I usually start with an analysis of our portfolio performance over the past day followed by a thorough review of equity research. Then I start looking at real-time market movements in Asian and European markets. Depending on the day, activities can for example include meetings with management of portfolio companies, meetings with clients or prospective clients, or formulating investments theses for new investments.

The typical challenges I face during the day is news flow which could impact the share price of portfolio constituents and the potential impact on our investment thesis.

In 2015, we started to cover health care services focusing on managed care to obtain a clear picture of the entire non-drug part of the healthcare sector and to benefit from the lower correlations between medtech and services.

3. How has the medical technology and healthcare services sector changed in the last years? what sub-sectors within this sector do you believe will be the next investment trend? what technologies should we be looking at?

The biggest trends in the medtech & services sector are digitalization and miniaturization. They led to new breakthrough innovations like continuous blood glucose sensors, automated insulin pumps, minimally invasive heart valve replacement and repair systems, and robotic-assisted surgery and biopsy systems.

4. What key principles drive your investment processes and why?

Our systematic, multistep investment process is driven by our proprietary stakeholder investment approach as we believe that in case of aligned interest of relevant stakeholders, a product/service offering has a higher probability of market success due to the absence of insurmountable obstacles. If it comes to bottom-up portfolio construction, position sizes are driven by conviction, visibility, and liquidity.

5. Do you take ESG into account when building your portfolio? Do you believe it is important to incorporate ESG to portfolios?

All our investment strategies must adhere to generally accepted ESG standards. Since 2019, Bellevue Asset Management is signatory of UN PRI (UN Principle for Responsible Investments) and therewith commits itself to actively consider ESG aspects in our investment processes, to take on an active ownership role on ESG issues, to adequately disclose ESG issues and to report on our related activities and progress.

6. What kind of companies are more interesting to you when trying to build a portfolio? What kind of companies would you never invest in?

I am a firm believer in highly innovative companies as they usually grow faster and achieve better margins due to pricing power. At the same time, I don’t prefer heavily indebted companies as they lack financial flexibility.

7. Would you give any advice to anyone wanting to start a career in the asset management industry?

If you consider a career in investment management starting as an analyst with the potential to become a portfolio manager over time, you not only need to have strong analytical skills, a strong work ethic, and attention to detail but also superb communication skills to build a relationship of trust with the client. Patience really helps, as you need a lot of experience in investment management.