Paperjam EXTRA Investor’s Guide 2025

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L’éclat… de la patience

Ils sont « rangés » devant une fenêtre embuée, sur un fauteuil roulant, un plaid à carreaux rouges et gris sur les genoux. Ils attendent qu’un rayon de soleil réchauffe leurs visages ridés ou qu’on leur apporte la soupe du soir. La technologie a ringardisé ces « bons » pères de famille à coups de slogans publicitaires ravageurs, qui promettent que tout est facile, tout est bon marché, tout est sûr et tout est hyper prometteur.

Comme ces joueurs de poker qui étaient prêts à pousser tous leurs jetons sur le tapis, convaincus de pouvoir tordre le bras de la chance, cette maîtresse capricieuse et volage, les néo-investisseurs ont les poumons gonflés. Et pourtant, le plus précieux de toute leur vie d’investisseurs, ils devraient l’avoir appris avant de commencer.

Commence petit avec de l’argent dont tu pourrais te passer si tu devais le perdre.

Vise à long terme. Diversifie. Sois régulier.

Ne touche plus à rien quand ça tangue de trop.

Ne crois pas ceux qui te promettent de trop beaux rendements. Éduque-toi en permanence.

Mais ces principes de prudence ne font pas rêver. Ils ne s’accordent pas avec l’ère de l’instantanéité, de la montée en flèche des fortunes crypto et des licornes surgies de nulle part. Qui veut encore entendre parler d’épargne patiente quand les influenceurs exhibent leurs Lamborghini et que la Bourse s’emballe au moindre tweet ?

Please recycle. Vous avez fini de lire ce magazine ? Archivez-le, transmettez-le ou bien faites-le recycler !

Juliette Noblot (coordination), Monique Bernard, Stéphane Cognioul, Julie Kotulski, Sara Piantoni Tous droits réservés. Toute reproduction, ou traduction, intégrale ou partielle, est strictement interdite sans l’autorisation écrite délivrée au préalable par l’éditeur. © MM Publishing and Media SA. (Luxembourg) Maison Moderne ™ is used under licence by MM Publishing and Media SA. — ISSN 2354-4619

Jusqu’au jour où… tout s’effondre. Car les marchés corrigent, les bulles éclatent, les gourous de la finance disparaissent. Seuls restent ceux qui avaient bâti sur du solide, qui avaient compris que l’investissement n’est pas un sprint, mais un marathon. Que l’accumulation lente et réfléchie l’emporte toujours sur les coups d’éclat. Et c’est ainsi qu’un jour, après des décennies de patience et de rigueur, certains finiront peut-être, eux aussi, devant une fenêtre embuée, un plaid sur les genoux. Mais ils n’attendront pas la soupe du soir. Ils contempleront simplement, sereinement, le fruit d’une vie d’investissements avisés.

Rédacteur en chef THIERRY LABRO

LES VALEURS RESTENT

Une société de gestion engagée pour répondre à vos objectifs patrimoniaux dans la durée.

Une gestion de convictions active et responsable.

Des solutions d’épargne qui s’adaptent aux différentes configurations des marchés.

Une expertise qui couvre l’ensemble des classes d’actifs, des styles de gestion et des zones géographiques.

Parlez-en à votre Conseiller Financier et retrouvez plus d’informations sur dnca-investments.com

Active ETF market asset growth by domicile

Growth in active ETFs has seen an acceleration of inflows in the last year on both sides of the Atlantic. With $65bn in assets under management in Europe against $864bn in the US, the experience of the latter may signal further upside potential in Europe.

Claudia Halmes-Coumont (Lalux), Pascal Rapallino (Luxembourg Association of Family Offices) et Candi Carrera (VingeGPT).

Nexus Luxembourg is set to return for its second annual edition, a two-day tech symposium and exhibition focused on AI, technology, and business. The event promises countless opportunities for inspiration, learning, networking, meaningful encounters, and strategic partnerships.

With exhibitors, speakers, and attendees from 62 countries participating in its inaugural edition, Nexus is building on this success to attract an even larger international audience to Luxembourg in 2025.

Nexus Luxembourg 2025 will also serve as a platform to showcase Luxembourg’s vibrant tech and innovation ecosystem. The event will highlight a dynamic blend of public and private initiatives in an intimate, boutique-style atmosphere  allowing attendees to forge meaningful connections with key players in technology, finance, and policymaking.

What’s your game plan?

We spoke to two experts--respectively a financial educator and a banker-who helped us review the basics of investing and tell us how to get started. Then we asked the banker what to do with different sums of money.

“If

The

During the three years in which Grégory Guilmin was doing his PhD thesis in finance, he lost about 60% of his savings in the stock market. “Which is why the last part of my thesis was about portfolio optimisation and how to invest in the stock market,” he says good-naturedly. But the loss helped him understand the emotional element to investing; and now, ten years later, he is working full time as an author and financial educator, helping non-experts learn how understand money and--more specifically--how to invest it. So, how should we invest it?

The game plan

For first-timers, Guilmin suggests asking yourselves three basic questions.

Why do you want to invest? This will determine everything that comes after. Maybe you want to retire early, maybe you want to take a year off, maybe you want to sail the world’s oceans with your partner, kids and the family hamster.

What is your security cushion? This is an assessment of your financial status, i.e. how much you earn, how much you spend, how much you have saved up already. For Guilmin, your cushion is secure if you’ve

got, in the bank, between six months’ worth of expenses and twelve months’ worth of salary. For example, if you make €3,000 a month and spend €2,000 a month, your security cushion should be between €12,000 and €36,000. The security cushion is not to be touched, but you might have something leftover after counting it. And with that number you can decide how much to invest per month. Per month? “Compound interest is very important,” says Guilmin, noting that it’s better to invest €100 each month than to wait ten months and invest €1,000. “It’s like doing sports. If you do sports for two weeks and then nothing for six months… it’s not good for your health. For your financial health it’s the same.”

How should I invest? You can invest alone or you can employ a private banker to take care of it for you. The pros and cons are pretty self-explanatory: a banker brings expertise and is somebody onto whom you can shovel some of the emotional stakes (if it all goes wrong, you can at least blame the banker); but bankers also take fees and, to at least some extent, have control over where your money is going.

Photo Guy Wolff (archives)

Journalist JEFFREY PALMS

This is the amount of investment loss that, Grégory Guilmin advises, you should be able to live with.

you’re not able to accept -20%, don’t invest in the stock market.”

number comes from the usually safe bond market, which fell by 18% in 2022.

-20 %

But I can’t do it alone

Wrong! You can . That, anyway, is Guilmin’s view. Granted, he makes his living teaching people how to invest in the stock market by themselves, but given the abundance of self-help books and how-to websites (and articles like this one), he’s probably right. It can’t be rocket science. “It’s not 50 hours, it’s not 100 hours,” he says, describing how long it takes to learn the tools you need. “It’s two hours a week for four, five weeks. That’s sufficient to give you very good knowledge so you can start investing.”

Still, circumstances can complicate the question of whether to jump in bed with a banker or not. First off, how much money are we talking about? “Investing

€1,000… everyone can do that,” says Guilmin. “But if it’s €100,000, or €1,000,000, you might feel a psychological pressure regarding the money. [In such cases] it could be better to have a banker invest it for you because it’s too much pressure.”

And secondly, how much are you willing to pay for convenience? A professional can take care of loose administrative ends and make the process smooth, true, but it will run you as much as 2%, “which is very, very expensive!” says Guilmin. That number comes from the average fees that investment bankers take, which is 1.96%.

Five questions to keep in your pocket

Let’s say you go with the banker after all. Guilmin wouldn’t have you arrive to the meeting unprepared: here are five questions to ask.

How do you make money? The fees may be here and they may be there: management fees, custody fees (the cost of keeping the financial instrument on your account), brokerage fees when you buy or sell. Some bankers take a performance fee as well.

INVESTMENT

TYPES CHEAT SHEET

BONDS

Governments and companies can ask you for some money and promise to pay it back, by a set date, with interest. That’s a bond. It’s classically low-risk, though not totally risk-free: the bond issuer could hit financial straits or indeed buy the bond back.

CERTIFICATE OF DEPOSIT

Another one for the risk-averse: a CD is when you give a bank some money and the bank returns it by a certain date with interest. The main downside is that, like the risk, the potential return is pretty low.

MUTUAL FUNDS

“ It’s like doing sports. If you do sports for two weeks and then nothing for six months… it’s not good for your health. For your finan cial health it’s the same.”

GRÉGORY GUILMIN Founder La Bourse: Make It Easy

Where do you put your own money?

Passive investments or active? “A few weeks ago I received a message from a person working at a bank,” says Guilmin, “who told me that 100% of his own wealth is invested in passive ETFs… but he cannot give that option to his clients because of pressure from his manager regarding the cost.” According to Guilmin, banks make a lot more money off active investments.

This is when many investors pool their money together for a greater overall investing power. It’s often an investment manager who chooses where the money gets invested (into which stocks, bonds, etc.) Mutual funds are less risky than regular old stocks, as they are more diversified. They can still carry risk, though: we have all heard of the stock market going down.

STOCKS

Stocks are parts--shares--of a company. As a part owner, you’re typically entitled to a portion of the company’s earnings (hey!) commensurate with how many shares you hold. Stocks have been a standard in investing for a long time. You can make a lot of money if profits soar… or lose it if profits tank.

ALTERNATIVE INVESTMENTS

This is a catchall for those things that are not a “traditional” investment, things like venture capital, private equity, hedge funds, art, commodities and real estate. Alternative investments are commonly the purview of professional investors.

<10 %

Fewer than a tenth of Luxembourg investors go for passive investments. But it has several advantages, says Grégory Guilmin, like lower fees (around 0.2%-0.4% on average versus 2% for traditional investments).

How does your performance compare to an index? Say, the MSCI World? A good test is to see if the banker is able to beat the MSCI World index, which is made up of 1,400 companies in 23 developed countries and is thus a good indicator of the worldwide stock market. (Beating it would be a good thing.)

When the market goes down, will my portfolio go even lower? Volatility is an important factor in the stock market. Things will inevitably turn downwards sometimes, but if your portfolio--at that moment--has low risk, then it’s OK. “But imagine you have a lower performance with a similar, or slightly higher, risk than the market… that’s not good for your money.”

If this bank goes bankrupt tomorrow, what happens to my money? Are you going to lose everything? It’s just good to know.

At the bank

Well, let’s bite the bullet and go to the bank. Why not hear what they have to say? Here is some general advice for first-timers from Daniel Biever, head of the investment desk at Raiffeisen.

Diversification is crucial. “It helps reduce risk by spreading investments across different asset classes (stocks, bonds, real estate, etc.) and regions.”

Respect your investor profile. “Assess your risk appetite and sustainability preferences before investing.”

Invest in what you understand. “Always make sure you fully grasp the features and risks of an investment before committing your money.”

Investing is for the medium- to longterm. “The market fluctuates in the short term, but historically, staying invested over time leads to growth.”

Define your financial goals. “Are you investing for retirement, wealth growth or a specific project? Your goals will determine your strategy.”

Stay calm. “Don’t get discouraged after first bad experience. Investing is a longterm strategy.”

Seek professional advice. “A financial advisor can help tailor an investment plan that fits your profile and objectives.”

Strategy talk

Earlier, Guilmin weighed in briefly on the question of active versus passive investments. First, though, what are they exactly?

Passive investing is when you invest in diversified funds that track a market index. “There’s no need to pick individual stocks,” explains Biever. “Your investment follows the overall market.” The advantages are that the fees are much lower--typically 0.2%-0.4% annually versus 1.96% for traditional funds, Guilmin points out--and that it’s just easier overall, i.e. less of a time commitment for you.

But, Biever says, you also don’t have a ton of flexibility with passive investing and you won’t be able to outperform the index.

Active investing, on the other hand, is higher risk and higher reward. “[If] you want to be more involved [and] go for conviction investing, you need to do active investing,” says Biever. “It offers you an opportunity for higher returns and more flexibility to react to market trends.”

“Nevertheless,” he adds, “this requires time, knowledge and research and is related to higher fees.”

The Raiffeisen expert breaks it down with the following advice: “If you prefer a simple, long-term approach, passive investing (index funds or ETFs) is often the best choice. If you enjoy market research and are comfortable with risk, you might explore active investing.”

“Many investors use a mix of both,” he adds, “combining passive ETFs for stability and some active investments for potential growth.”

Let’s launch some cash All right, we’ve made up our mind: we’re going to invest! Here’s what Biever says to do with €5k, €10k, €50k and €100k.

€5,000

“Clearly, this is the kind of amount you’d want to keep in cash for unexpected situations. Therefore, you should consider keeping this sum in your savings account.”

Composition of household portfolios in the EU

Investment

Insurance

Other

€10,000

“Supposing you can keep the €10,000 untouched for an extended period, and considering your risk profile, you may consider starting a R-PlanInvest savings plan. This solution allows you to invest smaller amounts regularly (monthly, quarterly or annually, starting from as little as €50) into an investment fund of your choice. This approach is especially suited for riskier funds, as the regular investment schedule helps smooth out market fluctuations over time, reducing the impact of short-term volatility.”

€50,000

“You can invest €50,000, but the choice of investment always depends on your risk profile and return expectations. An aggressive or dynamic investor would typically opt for a globally diversified equity fund, which could also be an ETF. For a balanced investor, a flexible or mixed fund might be the appropriate solution, as the fund manager adjusts the investment strategy depending on market conditions. Defensive investors can now find alternatives such as fixed-term bond

funds or aggregate bond ETFs, which offer more stability compared to classic bond funds.

€100,000

“For €100,000, you have the opportunity to build a diversified portfolio in collaboration with one of our advisors, tailored specifically to your risk profile and investment goals. Depending on your preferences, your advisor will recommend a mix of asset classes, such as equity funds, bonds and potentially structured products.

“If you’re an aggressive or dynamic investor, you might lean towards a globally diversified equity fund or ETFs to maximise growth potential, keeping in mind the higher volatility. A balanced investor might prefer a combination of flexible or mixed funds, which offer more stability while still capturing growth opportunities. In contrast, defensive investors can focus on fixed-term bond funds or aggregate bond ETFs, which provide lower risk but more predictable returns.”

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Investing for all: journeys to financial success

Investing is often seen as a complex world of spreadsheets and jargon, for Wall Street experts or the ultra-wealthy. But it is a tool for growth and security.

The journeys of Maxime Schang, a young investor starting early; Romain Boyer, a mid-career investor balancing family and work; and Jaime Gómez-Ferrer, a seasoned investor focused on stability and legacy show that investing is accessible to anyone willing to learn.

Journalist REBECA SUAY

The decision to invest is often accompanied by hesitation. Fear of losing money, a lack of financial knowledge and uncertainty about where to begin are common barriers. However, the most crucial step is simply starting. For some, like Maxime Schang, an analyst at Azur Capital, investing was a natural extension of his academic background. For others, such as Romain Boyer, who works as a business development specialist at ArcelorMittal, it was a realisation that came later in life, triggered by external circumstances. Jaime Gómez-Ferrer, who is a partner at The Directors’ Office, despite his deep understanding of financial markets, had to learn firsthand how real-life experience reshapes investment philosophy over time.

A lifelong journey begins: the first steps Unlike most beginners who start cautiously, Schang approached investing with confidence and conviction. “Initially, I wanted to make my savings work for me,

knowing that inflation erodes the value of idle cash.” Armed with a strong financial foundation from his business school studies, he viewed investing as a necessity for understanding how markets function in real time. “I made my first investment shortly after turning 18, as soon as I could open a brokerage account. It was my first step into understanding how markets operate in real life, not just through academic courses.” Unlike some newcomers who start small, Schang took a bold approach. “At first, like many new investors, I aimed to make quick gains by taking high risks with small amounts.” However, he quickly realised that no amount of theoretical study could replace actual market experience. “No book or online course can fully prepare you for real investing.” Experience teaches one how to manage emotions, handle losses and make better decisions, he says, adding that “real growth comes from firsthand experience”. His rapid immersion in investing laid the

foundation for the strategic and disciplined approach he follows today.

In contrast, Boyer’s journey into investing was more gradual. Before 2020, he followed a conventional savings plan, keeping his money in various accounts but never putting it to work in financial markets. Before 2020, he had 70% in cash, spread across a French savings plan, a housing savings plan and a company savings plan, but he wasn’t investing. The covid-19 pandemic provided him with an unexpected opportunity to reflect on his financial approach. “During the lockdown, I had time to reassess my financial management. I started reading, watching Youtube videos and taking an interest in the topic.” At first he experimented with a variety of asset types. “I tried a bit of everything: stocks, life insurance, crowdlending, crowdfunding, crypto.” However, he soon discovered that too much diversification without a clear strategy could be overwhelming. He wanted to try

THINGS TO KEEP IN MIND

WHY IT’S IMPORTANT TO START INVESTING EARLY

One of the biggest advantages of starting early is compound interest--the ability for investments to generate more earnings over time. The earlier you start, the more time your investments have to grow. Compound interest rewards patience, making time in the market more important than timing the market.

BEHAVIOURAL BIASES THAT AFFECT INVESTING

Investors may fall into psychological traps that affect their decision-making. Some common biases are:

• Loss aversion: Fear of losses leads investors to sell winning investments too early or hold onto losing ones for too long.

• Recency bias: Assuming that recent market trends will continue indefinitely, leading to overconfidence during bull markets and panic during downturns.

• Herd mentality: Following the crowd without doing independent research, often resulting in buying high and selling low.

WHY INVESTORS DIVERSIFY THEIR PORTFOLIOS

Diversification reduces risk by spreading investments across different asset classes, industries and regions. A well-diversified portfolio might include stocks, bonds, real estate, exchange-traded funds or mutual funds and alternative assets.

THE RISKS OF TIMING THE MARKET

Trying to buy at the lowest price and sell at the highest price--known as market timing--is extremely difficult, even for professionals.

• A consistent, long-term strategy (such as dollar-cost averaging) is usually more effective than trying to time the market.

• Whilst unsettling, market crashes are a normal part of investing.

• The key to surviving downturns is staying invested and avoiding panic selling.

“ The biggest enemy you have when investing is your emotions. Whether it’s going up or down, you must keep your emotions away and have a clear exit plan.”

MAXIME SCHANG Analyst Azur Capital

everything, but he realised that he needed a different approach. Over time, he refined his method, transitioning toward a more structured and passive investment strategy focused on automated ETF purchases (tracking several indices), bitcoin investments and the S&P 500.

His decision to focus on ETFs and the S&P 500 allows him to take advantage of long-term market growth while reducing the stress and complexity of managing multiple investments. The S&P 500, one of the most widely followed stock market indices, represents 500 of the largest publicly traded companies in the US and is considered a solid choice for investors seeking long-term growth and diversification, as it spans multiple sectors and mitigates individual stock risk. His journey mirrors the learning curve many investors face--starting with enthusiasm, making early mistakes and eventually

settling on a method that aligns with their financial goals and risk tolerance.

For Gómez-Ferrer, investing was never an unfamiliar concept. With more than 20 years of experience in the financial industry, investment strategy has always been part of day-to-day conversations. However, earlier on, his investment choices leaned heavily toward high-risk, high-reward strategies. “When I was younger, I took more risks. I invested in growth stocks and niche opportunities to capitalise on time.”

As the years passed and he experienced market downturns firsthand, his philosophy evolved. He learned that markets can be brutal. Financial crises taught him the importance of diversification. Now, his focus has shifted toward stability and risk management. His experience highlights a fundamental lesson--what works at one stage of life may not be the best strategy for the future.

“Inflation is something we don’t always notice, but it significantly reduces our purchasing power. Investing helps counteract this effect.”

ROMAIN BOYER Business development specialist

Understanding inflation and its impact on investing

Inflation--the steady rise in the cost of goods and services over time--gradually erodes purchasing power, making it a significant concern for investors. Without a strategy to outpace inflation, cash savings lose value. This is a reality that all three investors-Schang, Boyer and Gómez-Ferrer--have incorporated into their strategies.

Schang quickly understood that keeping money idle in a savings account wasn’t a viable long-term plan. “Inflation eats away at idle cash.” He realised he needed his money to grow, not just sit, he explains. Boyer shared a similar realisation, stating that one of his motivations for transitioning from savings to investments was recognising the risk of inflation eroding his financial security. While cash may feel “safe,” its real value declines over time if it’s not actively invested. Gómez-Ferrer, with his extensive experience navigating multiple economic cycles, stresses the importance of investing in assets that outpace inflation, such as stocks, ETFs and real estate. Investing is not just about making gains, it is about protecting wealth from the silent erosion of inflation.

Finding the right investment strategy

Every investor, whether a beginner or an experienced professional, eventually develops a strategy that aligns with their financial goals, risk tolerance and level of involvement. A fundamental piece of advice from Boyer is to only “invest an amount that you’re willing to lose.” He emphasises the importance of gradual investing and ensuring that financial commitments remain within one’s risk tolerance.

Schang views investing as a structured and analytical discipline that requires logic, research and discipline. He does not make decisions based on speculation or emotion, but instead relies on data-driven strategies. “I rely heavily on technical analysis and market trends. I try to have an approach based on facts and price patterns.” He also places significant importance on risk management. His strategy is a mix of active trading and long-term investments, balancing short-term market movements with wealth accumulation.

Boyer, on the other hand, started by exploring a wide range of investment vehicles but soon realised that simplicity was key. Over time, he transitioned to a structured approach focused on ETFs and dollar-cost averaging, a strategy where an investor regularly invests a fixed amount of money, regardless of market fluctuations. This method reduces the risk of making poor investment decisions based on short-term market volatility and helps smooth out price fluctuations over time. “ I invest the same amount every month, whether the market goes up or down.” His strategy is built on stability and long-term growth, reducing the risk of emotional decision-making while steadily building his portfolio.

For Boyer, maintaining liquidity has been a key consideration in his investment decisions, especially as his financial responsibilities have grown with his family. “I try to manage my liquidity; I don’t want to have only illiquid investments in case I need access to funds,” he explains. This became particularly important when he and his wife purchased their primary residence. “When I bought my home with my wife, I needed liquidity. If all my investments had been in assets that I couldn’t sell, it wouldn’t have been practical.” To ensure financial flexibility, he sold part of his portfolio to cover the necessary down payment, reinforcing his preference for a mix of liquid and longterm investments.

Gómez-Ferrer’s perspective has been shaped by decades of experience, leading him to prioritise wealth preservation over aggressive risk-taking. The financial crisis of 2008 and the covid-19 pandemic reinforced his belief that a well-balanced portfolio is key to withstanding volatile market periods. He spreads his investments across different asset classes to ensure stable growth and reduce risk. His method highlights the importance of adapting an investment strategy as life circumstances, financial context and goals evolve.

Balancing time: how much time they spend on investing

The time commitment each investor dedicates to managing their investments varies significantly based on their strategies

Photos Azur Capital and DR

“ Start to invest as early as possible, even with small amounts, focus on building a diverse portfolio, understand your risk tolerance and adjust your strategy as your responsibilities grow.”

JAIME GÓMEZ-FERRER Partner The Directors’ Office

and lifestyles. Schang, as an active investor, spends between one to two hours daily analysing charts, reviewing market trends and refining his strategy. He believes that success is not about quantity, but the quality of time spent studying the markets. Boyer, following a more passive investment approach, checks his portfolio once a month, spending about an hour reviewing his finances and ensuring he stays on track with his long-term goals. He prioritises consistency over frequent market monitoring. Gómez-Ferrer, with a focus on wealth preservation and diversification, dedicates approximately 30 hours per quarter to evaluating his investments, rebalancing his portfolio and adjusting his asset allocation when necessary. Each of them has found a balance between their investment strategy and their daily lives, demonstrating that there is no single correct approach--only what aligns with individual goals and circumstances.

Tools and technology in investing

Each investor relies on different tools to guide their strategies. Schang uses TradingView for technical analysis, which helps him monitor price trends and identify opportunities in volatile markets. Boyer prefers a more automated approach, relying on Finary to track his portfolio’s performance and Trade Republic for his ETF investments. These tools allow him to maintain an overview of his assets with minimal effort, reinforcing his passive investment strategy. Gómez-Ferrer, with his focus on wealth preservation, primarily uses brokerage reports and financial newsletters to keep up with market trends, favouring a research-heavy approach over technological tools.

Boyer has been closely observing the impact of artificial intelligence in finance, seeing it as a game-changer for personal investing. As an ambassador for VingeGPT, a Luxembourg-based fintech specialising in AI-driven market analysis, he believes that these technologies enhance investment strategies by making financial data more accessible and actionable. “AI is transforming investment strategies, making it easier to detect market trends and automate portfolio adjustments ,” he explains. While he remains cautious about

over-reliance on AI tools, he acknowledges their potential to help investors analyse financial statements, track market patterns and make more informed decisions with less effort. AI-powered platforms can provide deeper insights into stock valuations and risk assessments, allowing investors to fine-tune their portfolios while reducing the emotional bias that often leads to impulsive decisions.

Final advice from the investors

Investing is not a one-size-fits-all journey. Some investors thrive in active trading, while others find success in long-term, low-maintenance strategies. Schang emphasises the importance of continuous learning, emotional discipline and to avoid overtrading. He believes that successful investing requires patience, strategy and the ability to remain rational even in times of volatility.

Boyer emphasises patience, discipline and the importance of surrounding yourself with the right influences. His key advice includes educating yourself through books, financial content and newsletters, understanding your risk profile and focusing on investments you truly comprehend; avoiding impulsive investments driven by short-term profit motives and only investing money you are willing to lose.

Gómez-Ferrer, with decades of experience navigating different market cycles, stresses the importance of starting early and maintaining a well-diversified portfolio. He also advises avoiding emotional decisions and to do thorough research before committing to an investment. His perspective highlights how risk tolerance and investment strategies should evolve as responsibilities grow. What works in the early stages of an investment journey may not be suitable later in life, making adaptability a crucial skill.

“Financial literacy is too low, even in Luxembourg”

For Roger Hartmann, chairman of EFPA Luxembourg ASBL, not enough is being done to promote investing in Europe or in Luxembourg. This, in turn, has an impact on pensions. More education and additional initiatives are needed to boost financial literacy.

94,000

Founded in 2000, the European Financial Planning Association, is a standards-setting body for financial advisors and planners in Europe that--to date--has over 94,000 certificate holders. It offers globally recognised certificates that are meant to educate and support financial sector professionals throughout their careers.

Present across several European countries, the Luxembourg association was set up in 2020 by Roger Hartmann and Marco Caldana. Hartmann, who’s chairman of the board of EFPA Luxembourg, has spent 42 years in the financial industry, working in Asia, the US and Europe. “Everywhere,” he says, “with a very long stop in Luxembourg, which was a great stop.” Hartmann, who’s Swiss, has even acquired Luxembourg citizenship. “My specialisation was--and still is--in wealth management, very much dedicated to education,” he explains. “Now that I’m also somewhere in another part of my life, I’m even more dedicated to education.”

EFPA certifications differ from other programmes like the chartered financial analyst (CFA) programme or the credentials offered by the Chartered Alternative Investment Analyst Association (Caia)

because those are more “institutional” or B2B. “We are really B2C, because we certify not professionals who basically work with professionals; we are certifying so-called ‘financial advisors,’ as they’re called in the UK.” Here, these would be people involved in “gestion de fortune,” or the people advising private clients.

Start financial education at primary school level

When it comes to financial literacy and financial education more broadly, is enough being done in Luxembourg--and in Europe in general?

Hartmann hardly waits for the end of the question before giving his response. It’s an emphatic “no.” With its strong financial centre, Luxembourg “should be very, very much in advance compared to other countries [that are] less developed from the financial point of view. But there’s still a lot to do everywhere in Europe.”

“When you look a little bit what is going on in the US, basically all people invest. Basically, it’s in the culture to invest, since the 19th century,” he continues. “Here in Europe, we are still a continent of savers.

Journalist LYDIA LINNA

Overall, the European Financial Planning Association has issued over 94,000 certificates. The most common is the “European Financial Advisor” certification, of which 62,000 have been granted.

People have savings accounts, and yes, they know how to manage their savings account. But the European citizen is not present in the capital markets, and this is coming from a low financial literacy.”

“Financial literacy is too low, even in Luxembourg,” he emphasises. “If you really want to address the issue, I strongly believe we should begin to address it with the younger population. We should really go quite early into schools.”

Starting from what stage? Secondary school? “Even already primary schools,” answers Hartmann, “just to have a little bit of consciousness about the importance of money and money in general. When you begin early, you can also correct biases,” like the bias that money is a problem only for men and not for women. “Gosh, today, this should be part of a very old history. But it is not. And it’s quite proven that we can do a lot in order to increase awareness about money with young women already at primary school and, of course, at secondary school. I think there is no limit in the age to begin with that. I would really begin very early.”

Initiatives in place

There are already efforts in Luxembourg, adds Hartmann, with the Luxembourg Bankers’ Association (ABBL) carrying out training programmes in schools.

The ABBL has, since 2015, organised the “Woch vun de Suen,” or “Money Week.”

Supported by the grand duchy’s ministry of education, children and youth, the annual event is part of the European Money Week initiated by the European Banking Federation. “Volunteers teach students in cycle 4 of primary education in Luxembourg the basic knowledge for healthy and responsible money management,” explains the ABBL. The initiative aims to help young people “understand the value of money and raise their awareness of the importance of budget control for their future.”

“But we should enhance further,” says Hartmann, and perhaps even continue at the university stage. “It’s really all about awareness and increasing this financial literacy.”

Pensions: the earlier you start, the better

The issue of financial literacy also plays into pensions, a topic that has been in the

IMPORTANCE OF FINANCIAL ADVICE

Roger Hartmann at the European Financial Planning Association highlights the importance of a trusted financial advisor.

“A trusted advisor--someone who is giving good advice--has the same type of therapeutic effect as a medical doctor,” he says. “No trust, no business.”

The EFPA issues several different types of certificates for financial professionals, explains its website. Investors looking for financial advice might want to check if a prospective advisor has one of its qualifications, such as: European Financial Planner, who can provide “integrated”

recommendations “including investments at portfolio level, estate planning, international taxation, retirement and insurance needs not only for private clients but also for business owners;” European Financial Advisor, who can assist with “investments at portfolio level, but also including basic insurance/retirement/credit/financing solutions;” and ESG Expert Advisor, who has “the skillset to integrate ESG considerations into their advisory practices, effectively manage climate-related risks, and provide informed guidance to clients on sustainable finance and investment opportunities.”

spotlight in Luxembourg in recent months, thanks to the government’s focus on the future of the pensions system, potential reform and dwindling reserves.

“If you believe that your state pension will not be good enough, don’t address it at age 50, because it’s far too late, because you are too old already!” says Hartmann. Luxembourg’s pensions system has three “pillars”: social security contributions; supplementary pension schemes set up by employers; and private pension plans set up by individuals. Awareness around the pension system must begin earlier. “The earlier you begin, the better off you are at the age of 65. And that’s part of financial literacy.”

Crises are to be expected. If you start at the age of 25, then your time horizon is 40 years and crises will have less of an impact on your investment by the time you retire. “But if your time horizon is five years; if you begin to invest at 60, it’s far too late.”

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Smart investing: keys to good diversification

Having spent most of his career in the asset management industry, Carmignac Portfolio Patrimoine Europe fund co-manager Jacques Hirsch discusses the importance of having clear financial objectives and what might influence investment plans.

€33.9 bn

Total Carmignac assets under management as of 31 December 2024. Established in 1989, the asset management boutique’s team includes 61 fund managers and analysts and offers 25 different investment strategies.

Asset management boutique Carmignac’s headquarters are in Paris but it has two other main offices in Luxembourg, which opened in 1999, and London, plus smaller commercial offices in Spain, Italy, Germany and Switzerland. In Luxembourg, Carmignac employs around 50 staff. It’s also where 22 of the 35 funds it lists are domiciled.

Recently appointed as co-manager of the Carmignac Portfolio Patrimoine Europe fund--what the company calls a “flexible, socially responsible, mixed Europe allocation fund”--is Jacques Hirsch, who joined in July 2023. Prior to that (from 2011), he co-managed a multibillion AUM, multi-asset fund that was rated five stars by Morningstar and in 2022 was in the top decile. At the same time, Hirsch also joined the company’s strategic investment committee, which provides to the firm’s broader investment team top-down, macroeconomic analyses.

At the time of the announcement, the chairman and CIO of Carmignac, Edouard Carmignac, called him “an experienced portfolio manager who has demonstrated his ability to deliver strong performance throughout various market conditions,

including the volatility of recent years.” Most of Hirsch’s career, in fact, has been in the asset management industry, and he provided some of his insights with Paperjam.

20 versus 60

Of course, when investing at the age of 20 or the age of 60, different considerations should be taken into account. As Hirsch points out, on average, data (mainly from the US markets) shows equity in inflation-adjusted terms earning, over the longterm, around 6%-7% per year, while bonds bring around 3.5%-4%. Cash or short-term paper, meanwhile, bring around 2%-2.5%.

“So, you could say equities are superior, but the reality of the higher return comes with the risk of higher drawdowns, a lot more volatility,” he explains. “If you’re in your 20s, you should be able to focus on the fact that equities offer a higher return and not worry too much about the drawdowns.”

Meanwhile, for someone investing at the age of 60 or 70, for instance, equities could suddenly drop, potentially bringing about problems for someone who had hoped to put some of those earnings towards retirement. The advice for

Journalist NATALIE A. GERHARDSTEIN

Return comparison and opportunity cost

In the 16th edition of its “Asset Management in Europe” report, published in December 2024, the European Fund and Asset Management Association (Efama) illustrated the difference in purchasing power of €10,000 over 10 years (2013-2023) when held in bank deposits versus investing it in a hypothetical portfolio of equal proportions equity and bond Ucits. As EFAMA notes, “despite the sharp falls in global financial markets in 2022, the opportunity cost of holding €10,000 in bank deposits rather than in equity and bond funds can be estimated at €4,381.”

Source Efama, calculations based on Morningstar Direct and ECB data

Purchasing power of €10,000 invested in equal proportion in equity and bond Ucits at the end of 2013

Purchasing power of €10,000 held in bank deposits at the end of 2013

people to invest in equities while they’re young and perhaps reduce such exposure, Hirsch adds, is “broadly sensible”.

Furthermore, if equities are expensive, it’s not a good idea to be exposed to them, especially in one’s later years. Hirsch cites the example of Microsoft, which had reached a $600bn market cap by the end of 1999 (compared to $348bn at the start of that year). “Microsoft was a great company, but it was very expensive in 2000. If you would have bought it in 2000, it would have taken you 15 years to get back to where you were.”

Exposure to AI

For those somewhere in the middle of that age range, it’s generally good to be diversified. On a market equity basis, Hirsch says many are betting on AI. “The market is very concentrated around it, but in valuation terms, we’re talking about companies that are very expensive today,” Hirsch says.

Diversifying, then, could mean considering other US stocks which are not specifically AI-exposed, or moving toward European exposure. At the time of writing, the German federal election was still two weeks away, while the US and Russian presidents stunned the world with talks on a peace deal to end the war in Ukraine. Outcomes for either could potentially be gamechangers for Europe.

Bottom line: “It’s important to be diversified. Having just an MSCI World position, I think, gives you too high an exposure to the US--and this exposure to the US gives you too high an exposure to AI.”

Hirsch says that last year their exposure to AI was above that of their benchmarks but has since been lowered. There were two reasons for this: first was that valuations were higher, so he says the risk-reward has possibly deteriorated somewhat. The second reason is linked to the hyper-scalers that are putting billions into AI each year and whether applications will

be found and bring in returns on those investments. Furthermore, there doesn’t seem to be a monopoly on the technical side, given, for instance, recent news that the Chinese startup Deepseek has a more cost-efficient AI model.

In addition, in a 13 February flash note published on Carmignac’s website, diversifying in AI has also meant “looking at the AI infrastructure value chain to identify niche but essential players. Taiwan is emerging as a significant hub in this field. The region is home to several key companies that are not only crucial to the AI infrastructure, but also profitable, offering attractive valuations. This is partly due to the geopolitical premium associated with the region.”

Other diversification

According to Dow Jones Market Data, US-listed companies dominated the global equity market in 2024, with more than a 50% share. Within that, tech companies have been dominating the rally.

“Keep a bit of tech, because it’s the future and those businesses are actually spectacular, but if you can diversify away from tech in the US, away a bit from the US equity market altogether, that’s probably interesting,” Hirsch explains.

Rethinking investing with a more thorough geopolitical point of view was also echoed in CEO Edouard Carmignac’s 21 January 2025 letter, in which he wrote, “We all sense that world growth, going forward, will slow. Countries with poor political governance will be left behind. Already, differential forces are exerting themselves on growth: US versus Europe, India versus China, Argentina versus Brazil...”

Apart from Europe, Hirsch says other opportunities could take shape in emerging markets. “Some had a lot of pain last year, and we think that now they’re actually offering an attractive valuation,” adding that Brazil could be among the options to consider. Additionally, diversification in the form of fixed-income investments is another option. Hirsch adds that inflation-protected instruments in the US also appear interesting.

The role of risk tolerance

So, when shaping a profile, how can investors assess their own risk tolerance?

“Align what your future cash profile is likely to be and the volatility of the assets you’re going to invest in.”

JACQUES HIRSCH

Co-manager,Carmignac Portfolio Patrimoine Europe fund

Hirsch says the best is to “align what your future cash profile is likely to be and the volatility of the assets you’re going to invest in.”

It’s important to consider, for example, if there’s a big upcoming cash outlay--university expenses, a luxury holiday, purchasing a home, etc. In such cases, “I would strongly advise against buying equities because they’re volatile,” he says. “You could find yourself in a position where you’re forced to sell at a low.”

As previously noted, it’s also important to consider the time horizon over which the investments will be made. When it comes to investing over the longer term, there are certain things to keep in mind. With classical bonds, Hirsch says the real danger is linked to unexpected inflation rates. “If inflation actually picks up a lot over the life of your investment, then the real, inflation-adjusted value of your coupon is going to decrease,” he says. “Unexpected inflation actually can destroy your income and then reduce the appeal or the effectiveness of the investment.”

On the other hand, exposure in most equities means you have exposure to a stream of earnings. “If these companies have got a strong pricing power, you get some protection against unexpected inflation.”

An eye on data

Behavioural finance is an economic theory that tries to explain how certain psychological influences impact one’s financial or investment decisions--biases which can at least partly help explain some of the more severe anomalies on the stock market. These considerations include concepts as vast as heuristic decision-making--using a rule of thumb or a quick mental calculation to make a decision--to herding behaviour, or the potential tendency of individuals to keep step with crowd thinking.

Hirsch says one of the most common mistakes investors make is falling into the trap of loss aversion--trying to avoid a short-term loss over a couple of days, for example, and therefore reducing that position. “But the reality is that what you actually lose sight of is the fact that over a three-, four-, ten-year horizon, what happens in the next two days is pretty irrelevant.”

Photo Carmignac

BILLIONS OF EUROS UNINVESTED

How can European savings be mobilised?

It’s a question Serge Weyland, CEO of the Association of the Luxembourg Fund Industry, reflected on in a recent guest contribution to Paperjam ahead of Paperjam Club’s 10x6 event dedicated to the future of the Luxembourg financial centre.

A call to action needs to be taken, he urged, referring to the €14trn that European households, including those in the UK and Switzerland, have tied up in current and savings accounts.

“This represents 41% of the net financial wealth of European households,” he wrote.

“In contrast, in the US, only around 15% of savings are not invested in capital markets. If Europe could mobilise these savings, it would free up about €5,500bn for the capital market and potentially the European economy.”

He called for Europe’s development of the Savings and Investment Union to be a top priority and for the focus to shift on discussions that would “prioritise integrating

European capital markets to unlock their full potential for business financing nd economic growth. This ambitious objective demands bold measures, from tax incentives to adjustments in labour laws.”

Weyland also proposed an array of ideas that could help empower citizens to take their financial future into their own hands and foster consumer trust and security-among them, for instance, introducing financial literacy courses at schools. His full guest contribution can be found on en.paperjam.lu.

It’s also important to be realistic when it comes to the probability of events happening that could impact investments. Hirsch adds as a reminder that there are plenty of ways for investors of all kinds to keep informed practically in real-time-gone are the days of looking up prices in a newspaper. While more sophisticated investors might subscribe to various services for information, there’s pricing information and market data easily accessible and readily available for even the less-savvy investors.

Sustainable investment outlook

When it comes to ESG criteria and ranking for companies, Hirsch says this information is readily available to professional investors. Broadly speaking, Hirsch says in his experience, most in Europe are still aspiring for Article 8 funds under the Sustainable Finance Disclosure Regulation. Also called “light green” funds, these are funds that promote environmental or social characteristics. These differ from Article 9 funds, which have sustainable investment as their objective (also called

“dark green”), while Article 6 funds are those without a sustainability scope but which require asset managers to disclose sustainability risk.

In its 2024 retrospective, Carmignac wrote that the election of US president Donald Trump would be an “interesting moment for sustainable investment,” adding: “ While the overwhelming narrative is that Trump will be bad for sustainability outcomes, we are more optimistic with sustainability now firmly embedded into regulation and corporate strategies.”

The retrospective summarised three major challenges to sustainable investment. One is rethinking these financing models in the context it called “reduced regulatory support, high public debt and low confidence in governments.” Secondly, it noted that the achievement of multinational initiatives, such as the Paris Agreement, is complicated as a result of deglobalisation. Lastly, aligning global realities with market outcomes in a more effective manner will require “a robust conceptual framework for assessing the trade-offs between environmental, social and financial capital.”

“More than just a distribution hub” Carmignac opened its first international office in 1999 in Luxembourg, which today employs some 50 staff out of its roughly 300 total. As Paperjam recently reported, during Carmignac’s investors conference held in Paris on 23 January 2025, head of the cross asset team Frédéric Leroux said the initial aim was to use the grand duchy as a hub “for European distribution and international distribution”, initially with three flagship funds.

Now, said Kevin Thozet, member of the investment committee at Carmignac, it’s more than just a distribution hub,” adding: “We have people managing money in Luxembourg.”

Household financial assets

As of the third quarter of 2024, Luxembourg households held €125.6bn in net financial assets, excluding real estate, according to data from the Luxembourg Central Bank. Of this, 44.3% was held in cash or bank deposits, while equities and investment fund shares accounted for 37%. The third-largest asset category was insurance and pension policies, making up 14.2%.

1'000 EUROS TO YOUR BANK

swissquote.lu/1000

Energy sovereignty may reduce investment returns in renewables

The infrastructure unit of the European Investment Fund invests only indirectly into sustainable assets. Its funds of funds may enjoy a favourable macroeconomic development where lower interest rates may boost the return of its underlying renewable and greenfield projects.

“EIF targets different returns depending on the resources it invests and the strategies pursued by the portfolio funds. The returns targeted by the portfolio funds range from relatively low returns of 5%-8% for conservative strategies (i.e. social infrastructure sector) to up to 20% in riskier strategies focused on the development and growth of infrastructure platforms.”

The business of the infrastructure group at the European Investment Fund is to invest in funds that invest into newly built assets which are also called greenfield assets, explained Gabriele Todesca, head of infrastructure at the EIF, during an interview with Paperjam. “Our investors, our stakeholders, have policy objectives in mind, and they want to see precisely the development of new assets in certain key strategic areas.”

One of these key areas is in energy infrastructure. It accounts for “a bit more than 50%” of its assets. It encompasses renewable generation, renewable energy storage, transmission and energy efficiency. “Zero investments in fuel assets. We cannot invest in fossil fuels.” Despite being seen as part of the energy transition in some countries, EIF does not even invest into natural gas infrastructures.

The other key strategic areas are transport infrastructure, digital infrastructure and “a bit” of social infrastructure.

EIF investment mostly in funds holding equity positions of projects but also some junior debts. Investment in senior debt occurs on a “very small scale” because its

parent company, the European Investment Bank, “does a lot of direct lending” to senior direct lending projects.

State of the industry and trends

Despite some backpedalling by the US and some European countries, “there’s still a strong commitment” to the energy sector to support the green transition in Europe. Besides, he thinks that the pushbacks from “some parts of the political spectrum” on the green transition has been partially offset by the renewed push for energy security.

He thinks that the green transition and the energy security objectives “complement each other.” He explained that since the Russian invasion of Ukraine, “it has become clear that Europe needs to become self-sufficient and independent from an energy perspective, which we are not yet.” He added: “the objectives are pretty clear… It’s about not depending on third countries for our energy.”

Contrary to Canada, for instance, which has “massive” fossil fuel resources, Todesca commented that Europe has to go through the green transition. Power is

Journalist SYLVAIN BARRETTE

currently coming mainly from renewables but “if you want to become self-sufficient, you have to develop your renewable infrastructure…. So I think the policy support for this industry will not change… power generation remains a priority.”

Shift toward energy efficiency

Yet he noted a shift from producing more power towards wasting less power by using power more smartly and efficiently. He explained that the EIF has large investments in solar and wind. It will continue to invest in power generation. In addition, the new focus means that the fund now invests energy storage, batteries, transmission, grid interconnectors and in energy efficiency.

Todesca remarked that energy efficiency takes several forms. For instance, it could be a city district, or a town deciding to improve the efficiency of public lightings or support the renovation of a hospital to make it more energy efficient. “People don’t realise how much electricity we waste ” Paperjam pointed out that renovating a hospital is not like building a new asset, and Todesca argued that the renovation required new capex such as electrical systems, new lighting systems, smart meters, etc. “Greenfield means new capex rather than simply buying something that is already up and running, not touching it and simply running it.”

Solving transmission bottlenecks

On challenges related to the connection of newly built power generation assets to the transmission grid, he noted that electricity regulations must play their part. However, he refrained from commenting further, apart from stating that the EIF invests in quality assets. He remarked that “we cannot achieve a perfect integration of electricity markets just through investment.”

AI and infrastructure

With the rise of artificial intelligence and the cloud, it will not come as a surprise that the EIF is also active in digital infrastructure. Mindful that Europe is already behind in terms of AI development, Todesca argued the promotion of national champions requires infrastructure that train AI models “which are very data intensive and energy

“Greenfield means new capex rather than simply buying something that is already up and running, not touching it and simply running it. ″

GABRIELE TODESCA Head of infrastructure EIF

intensive.” It does not stop there. To ensure a seamless experience by the users, AI apps require very low latency, i.e., quick responsiveness. Consequently, he argued that the data centre and the computer power must be “very close to users.”

Sensing the urgency of the topic, He noted that the EIF invested in 2024 in a fund (whose name is not publicly available) that invested solely in data centres and today such an investment means “mostly investing in AI-ready data centres.” He observed that new data centres, nowadays, are generally meant for AI purposes. These require specific architecture, energy provisions and adapted cooling systems. Previously, he remarked that the EIF invested in funds that invests in data centres among other technology assets such as telecommunication towers. The goal of the organisation is nowadays to invest in niche funds targeting more precisely policy objectives.

He is unclear whether Europe will catchup with the US and China on AI apps but he reported that it is estimated that worldwide data centre capacity will triple in size by 2030. Most of that rise will occur outside Europe, which should nevertheless require its own capacity to increase by two to three times current needs.

Recent headlines on Deepseek, a Chinese artificial intelligence software company developing an open-source large language model (LLM), raised question on whether the projected demand for data centre capacity is really justified. Indeed, he claimed that there are reports that Deepseek could operate “without so much computing power… if you don’t need computing power, you don’t need data centres.”

He takes comfort that the hyperscalers--Amazon’s AWS, Google Cloud, Microsoft’s Azure, IBM Cloud, and Oracle Cloud--which are large cloud service providers of computing and storage at enterprise scale, have committed “hundreds of billions” in investments that are planned for the next few years in the US mostly, but also in Europe.

Sustainable transportation E-mobility and its charging stations is a big thing and it’s growing very significantly” at the EIF. He noted that electric vehicle

sales “are slightly lower in terms of growth rate than expected” but affirmed that the “long term trend is expected to be growing still and quite significantly.” He believes that there still a commitment from investors to develop charging station networks across Europe.

Elsewhere, Todesca commented that the EIF is “looking” at sustainable aviation and sustainable maritime transportation which also includes ship refitting with hybrid engines using traditional and sustainable fuels.

Social infrastructure: an emerging asset

“This is linked to mega trends in terms of the aging population in Europe and demographics in general.” Interestingly, EIF addresses housing affordability, which is also a hot topic in Luxembourg. He argued that housing has become unaffordable for large segments of the population, “pretty much everywhere in Europe.”

He stressed the issue is not about social housing but rather about housing for the middle-class. The group that includes EIF, the EIB and the European Commission are looking to address the matter, having hired a housing commissioner. For its part, the EIF invests in funds that promote sustainable housing projects. He noted that governments will often subsidise projects in which the fund is investing.

Power generation and return on investment

Questioned by Paperjam on the appropriateness of investing further in power generation given that we have seen prices going below zero in some regions, Todesca replied that these developments have happened “on certain days in certain countries… the average prices of electricity in Europe are still much higher than in the US.”

Yet as the EIF maintains a focus on power generation and its additional supply keeping potentially a lid on electricity prices, investors may wonder whether it will depreciate their return on investment.

“The long-term trend that we see, at least in the market is there’s going to be more demand for electricity.” He reiterated that data centres, but also economic growth generally, will drive additional demand.

European Investment Fund

Taking advantage of lower interest rates “The macro situation is beneficial today for infrastructure investments.” He takes comfort that interest rates are going down in most developed markets as leverage becomes cheaper to finance new projects and, second, the return on the projects is expected to yield a better return.

Declining interest on greenfield and brownfield projects are both positive for their investors, but Todesca noted the impact of the former is greater because there is a longer ramp up period. “You’re paying less for the capital during that investment phase, then of course, your overall project return goes up.” Moreover, as interest rates are moving down, he suggested that it increases the attractiveness of the asset class relative to other asset classes largely because infrastructure offers a spread pickup over government bonds despite being considered similarly “pretty stable, pretty safe and resilient.”

The investment case for infrastructure that Todesca made was that the long-term nature of these investments which are often having a longer duration than government and corporate bonds makes the alternative asset more attractive to lock up a higher yield against an investment in bonds that must be reinvestment at a lower future yield.

In addition, he commented that many projects in the energy and “all sort of sectors” are inflation hedged as their revenue models are accounting for inflation triggers.

AT A GLANCE

The European Investment Fund invests in infrastructure funds. They are therefore an indirect investor in infrastructure with its focus being on the EU. More specifically, it invests in funds that develop new assets. Using an industry verbiage, EIF has a greenfield focus; it invests in funds creating new assets instead of buying existing assets to run a yield. The focus of the fund is on sustainable infrastructures.

Gabriele Todesca has been working at the EIF for 18 years. Before his move to Luxembourg, Todesca worked in investment banking and private equity in London. He has worked in all the various asset classes that the EIF is active in: growth private equity, venture capital, private credit and infrastructure. He has also been active on the investor relations and fundraising side and what is called internally “equity partnerships”.

European stocks: start of a rotation out of US techs

Over the past 25 years, Leon Kirch has nurtured an investment process whereby security selection takes precedence over other considerations. He noted that not only Anglo-Saxon but also European investors have started reallocating financial resources in favour of European stocks.

Leon Kirch

the

that the German

an economy officially in recession. “A good economy does not necessarily mean a good stock market and inversely, said Milton Friedman,” stated Kirch. He noted though that “it is really only few stocks such as SAP that pushed up the Dax.”

Despite his management roles, Leon Kirch, managing partner and conducting officer in charge of portfolio management at European Capital Partners, keeps a hands-on approach on investment of the firm. Being in the business of investment, he thinks that it is crucial to stay on top of market developments.

“It is a very competitive market and we must be able to justify why we charge management fees.” Moreover, he commented that an active involvement in investment enables him to better understand the need of third-party investors when it comes to asset servicing.

Investment philosophy and how it has evolved over time

“Our philosophy is based on ‘entrepreneurial value investing’… these three words summarise my entire career,” said Kirch. He explained that entrepreneur means that the investment risk of an investment is linked to the fundamentals of a company. Provided that you paid an “acceptable” price, he thinks that one should see valuation

increase when the fundamentals are also improving.

Kirch admitted being inspired by Benjamin Graham, the father of value investing in the 1930s. More specifically, he focusses on the earning power of a company that he defined as the discounted discretionary cash flows while assigning very little weight to their growth to obtain a fair value. It is then compared against the market valuation. A safety margin of around 40% between both levels may reflect an attractive proposition.

The third part of its philosophy, investing, is about buying a security and staying patient until “Mr Market” discovers the intrinsic value, resulting in the margin of safety closing off, i.e., falling to zero. Normally Kirch sells once the stock has reached a fair valuation. Such strategy enables him to be patient as the company generates cash flows or reduces its debt load, pays dividends and buys back shares. Kirch stressed that he has a greater focus on a company’s ability to generate profits

Journalist SYLVAIN BARRETTE

noted

Dax stock index returned more than 50% in

last two years despite

than the dividend level as a high dividend distribution may hide other problems and even weaken a company’s financial profile.

European equities: valuation discount to decline with US equities?

Kirch talked of an oversized attention by the market to the US and the Magnificent 7 tech giants as the market cap of the former accounts for 68% of the MSCI and 33% of the S&P 500 for the latter. He sighs at the little attention paid by AngloSaxon investors to the European market, but acknowledged that the US is the “real economic engine of the world,” while Europe is still “full of problems.”

The punchline “America innovates, China replicates and Europe regulates” partly explained the underperformance of European stocks, according to Kirch. He is concerned that the extensive regulation of AI may stifle innovation for an emerging industry. “You may need to hire 50 legal advisors for one computer scientist when launching a company based on” large-language models in Europe “while you need, in fact, the opposite setup.”

There is no doubt that most of the world has performed badly when compared to the US in terms of stock performance in recent years. It is therefore not solely a European phenomenon. However, Kirch noted that European stock performance compares well to its own past. He pointed out that the MSCI Europe forward P/E ratio is close to the average (14.3%) of the last 35 years. The same is true for the cyclically adjusted P/E ratio (19.2X) and the price-to-book at 2.1X. Without providing aggregated market levels, he commented that his favourite valuation metric is the enterprise value-to-cash flow ratio when looking at individual stocks.

Reviewing the marketing material from ECP that included a chart from JP Morgan, it was remarkable to note that all industries in Europe are cheaper compared to the US, with banks and utilities being the cheapest.

It will therefore not come as a surprise that he observed the beginning of rotation from the US, to European stocks. Kirch thinks that it is a combination of US investors refocussing across the pond and

European investors taking profits on their US tech positions and repatriating financial assets back home.

Kirch is agnostic on the sector, country or company. He is not a large or a small cap investor but a self-labelled “flexcap.” He applies a stock screening from which he finds his investment ideas. He ensures that the portfolio is diversified enough in terms of sectors and would not favour one country over another.

Individual stock valuation prevails over other preferences

Few companies were discussed during the interview. One of them was Novo Nordisk. Despite the concerns of sanctions by the US on Denmark and/or its firms on the back of tensions over Greenland, Kirch commented that he started to invest again in the stock in January after it was

hit hard enough in December. The stock repricing justified a review of the investment case given an ongoing “substantial” growth potential and a potential return on invested capital above 40%.

Kirch thinks that the company badly communicated the outcome of their latest clinical tests about the reduced efficiency of the weight-loss product due to a dose reduction by patients. Besides, he sees the capacity to produce its treatment for obesity and diabetes on a large scale as a competitive advantage.

Kirch thinks that reason will take precedence over possible US sanctions given the pressing need for Americans to reduce obesity and the imbalances between offer and demand on GLP-1 products.

On the other hand, he is very reluctant to invest in “price taker” industries such as steel where a competitive advantage is

“You may need to hire 50 legal advisors for one computer scientist when launching a company based on ‘largelanguage models in Europe’ while you need, in fact, the opposite setup.”

LEON KIRCH Managing partner and conducting officer European Capital Partners

hard to build. He would therefore avoid a company such as ArcelorMittal. Partly given the lack of internal expertise, he also shuns utilities as adverse regulatory actions may cut down the return on investment.

AI: synonymous with productivity gains Measuring his words, Kirch thinks that AI is a “real revolution in all sectors.” He commented that “at my age, I do not want to miss that train given its potential.” He reads extensively on the subject, including a recent keynote from Nvidia’s CEO Jensen Huang which revealed insights on AI’s practical use in robotics amongst other sectors.

However, he struggles to think of any--listed--European firms at the technological AI forefront. Kirch noted that Nvidia processors could not be built without Dutch equipment-maker ASML, but believes that Europe lost the war against China and the US and that the recent small investment announcement dedicated to AI by the EU will not change the picture.

Yet it is not all gloom and doom as some old European industries have decide to go AI. Kirch spoke enthusiastically about Kion, originally known for its forklifts which nowadays uses AI in a collaboration with Accenture and Nvidia to automate and improve productivity of manufacturing plants and logistic centres for its clients.

Elsewhere, he thinks that the pharmaceutical industry--with companies such as Roche, Sanofi and Novo Nordisk--have embraced the technology on pre-clinical trials amongst other use cases.

Kirch also reported the comment of Goldman Sachs CEO David Salomon, saying that more than 90% of an IPO prospectus is written in less than 10 minutes. He thinks that the same could apply for fund prospectuses.

Yet Kirch does not think that AI has reached the point of “reading between the lines”, making the role of humans still essential.

Learning from previous mistakes Kirch also talked humbly to Paperjam about past mistakes, probably as a signal that he learned the hard way. In the case of Agfa,

BACKGROUND AND COMPANY PROFILE

Leon Kirch, managing partner and conducting officer in charge of portfolio management, started his adventure at European Capital Partners in 2014 when he became a shareholder of the firm in Luxembourg, developing the liquid business and expanding its expertise in private equity and real estate. The firm went from €350m in assets under management to almost €2bn with 35 employees. It also has an office in Brussels. ECP currently has three businesses: asset management (European value and global strategies on stocks and bond strategies), asset servicing of third parties (risk, compliance, operation of private equity, real estate, hedge funds, etc) and wealth management of high-networth individuals (discretionary portfolio management).

a firm better known for its photo films before the advent of digital cameras, he strongly believed that its “cash cow” businesses in healthcare, imaging and offset printing would have helped its digital transition. However, the firm was hit by a succession of profit warnings on the back of a transition that took too long to materialise.

Kirch commented that in 2018, ECP took a “contrarian bet” on Europcar after its share price tumbled amid investors’ fears over high debt and disappointing earnings. Despite the prevalent pessimism, ECP believed the market misunderstood Europcar’s leverage story given that the rental industry often benefits from repurchase programmes from car manufacturers that help manage fleet costs. The asset manager exited its position just before the onset of the covid crisis, when the company suffered from “plummeting revenues” that hit its profitability hard. These events ultimately forced Europcar into a deep restructuring and paved the way for its acquisition by a consortium that later delisted the company.

ECP is not all about stock picking Kirch considers his shop as an active manager. Yet ECP’s wealth managers may recommend ECP funds but also exchange-traded funds (ETFs) for its highnet-worth clients. As the focus of ECP is on Europe and the US, it may recommend, for instance, ETFs focussed on India and Japan, as appropriate. “It is always long only, no reverse ETFs.” ECP would also take exposure on thematic ETFs on the back of a strong view but also when it has no internal competencies on the underlying individual companies.

Potentiel haussier sur les actions américaines

Même si les marchés boursiers américains sont restés à la traîne des autres régions en janvier, à moyen terme, les perspectives macroéconomiques restent favorables à la performance des actions américaines.

Les investisseurs cherchent à déterminer les potentiels gagnants et perdants du secteur technologique.

Si les droits de douane remettent en question les valorisations élevées des actions américaines à court terme, les réductions d’impôts sur les sociétés, ainsi qu’une reprise des secteurs non liés à la consommation devraient soutenir la croissance bénéficiaire cette année. Les développements concernant DeepSeek pourraient constituer des freins à court terme, les investisseurs cherchant à déterminer les potentiels gagnants et perdants au sein du secteur technologique. A long terme toutefois, cette percée devrait s’avérer positive en accélérant l’adoption de l’IA en général et en soutenant ainsi la chaîne de valeur de l’IA.

CROISSANCE DES BÉNÉFICES

DES ENTREPRISES AMÉRICAINES

Les politiques favorables à la croissance de la nouvelle administration Trump ajoutées à la vigueur des dépenses

de consommation et à la reprise naissante de l’industrie manufacturière devraient stimuler la croissance des bénéfices des entreprises américaines en 2025. Nous tablons sur une progression des bénéfices de 12%, laquelle servira de moteur essentiel à la performance du marché, et voyons un potentiel haussier à 12 mois de l’ordre de 10% pour l’indice S&P 500. Quand bien même les valorisations restent élevées, la croissance des revenus et l’expansion des marges conservent le potentiel de générer de nouveaux gains, à l’instar des scénarios des trois dernières années.

Le modèle d’intelligence artificielle DeepSeek a secoué l’industrie technologique mondiale en remettant en question les hypothèses du marché quant à la domination stratégique des entreprises technologiques américaines, à la valorisation de leurs titres et à la nécessité d’investissements infrastructurels massifs.

La performance des marchés actions pourrait rester limitée à court terme en raison de la persistance des incertitudes liées à DeepSeek et aux tarifs douaniers, d’autant plus que l’IA a été un argument essentiel pour de nombreuses grandes capitalisations dans des secteurs non technologiques tels que l’industrie et les services publics. Au sein du secteur technologique, nous conservons un positionnement neutre sur les grandes capitalisations par rapport aux petites capitalisations, les premières présentant des opportunités sélectives tandis que les taux d’intérêt élevés génèrent des vents contraires pour les secondes.

LOMBARD ODIER (EUROPE) SA

Edmund Ng, Stratège actions

Marco Barresi, Analyste senior recherche actions, Secteur technologique luxembourg@lombardodier.com

“ETFs are not per se passive”

Investors in passive exchange-traded funds generally do not realise that their ETFs are much more active than they thought. Stefan Kuhn thinks that Fidelity offers products that are “risk controlled” with a potential for outperformance for an average cost of 20 basis points (bps).

What explains the large gap between the market leader, JP Morgan Asset Management, and Fidelity? “Ever since I’ve worked in the ETF industry, there has been a very big first mover advantage,” said Stefan Kuhn, head of ETF distribution, Europe at Fidelity International. He explained that as the fund gets bigger, it improves liquidity. It then enters a virtuous circle.

When the European active ETF business started three or four years ago, Kuhn noted that JPMAM benefited from a longer track record than its competitors, thanks to its US strategies. “They could say: ‘this is a proven investment approach. We’re bringing this to Europe’.” In addition, he thinks that the corporate strategy had strong support from its CEO, Jamie Dimon, who promoted the firm as a “goto player in active ETF.”

Fidelity going its own way

It decided to offer “all kinds of variants” from “high octane, highly concentrated active funds through more systematic approaches. And we have active ETFs.”

Fidelity does not offer passive ETFs in Europe. It believes that its competitive advantage lies in its brand, research and client connectivity. On the latter, Kuhn commented that being an active manager enables his firm to speak with “a lot of investors” across Europe.

Kuhn observed that the rise of passive ETFs in Europe was prompted by the notion from many investors that “active doesn’t work, because over a certain time period… the vast majority, if not every fund manager, does not earn their cost.” Besides, Kuhn said that Fidelity assessed that the passive ETF business was a “scale and a price game and that’s not in our DNA.”

Keep cost-focussed clients

Kuhn noted that Fidelity’s clients fleeing towards passive ETFs were motivated by cost and their ability to perform the index minus the fees. In other words, he argued that clients will always underperform the index by “a tiny bit.”

The conclusion at Fidelity was not only to reduce cost, but also risk. “What [clients] don’t like is active research that

Journalist SYLVAIN BARRETTE

Active ETF market asset growth by domicile

Growth in active ETFs has seen an acceleration of inflows in the last year on both sides of the Atlantic. With $65bn in assets under management in Europe against $864bn in the US, the experience of the latter may signal further upside potential in Europe.

Source Fidelity International, 2024. Morningstar asset flows, compound annual growth rate, split by index and non-index, as of 30 November 2024

gives you plus 5% one year, minus 7% the next year against the benchmark,” said Kuhn. He thinks that clients did not like that volatility and that they considered that they paid too much for it.

Consequently, the asset manager started working on active ETFs that could offer the expertise of its research analysts in a “much more constrained way around an index” while targeting a performance of the index plus 100 basis points (bps) for all their “research-enhanced ETFs.”

Accounting for ESG considerations, Fidelity removes non-appropriate companies from a sustainability perspective and can underweight or overweight individual companies by no more than 100 bps versus the benchmark. Moreover, the country and the sector exposure are allowed to deviate by no more than 200 bps.

Using the MSCI Index World as a starting point, Kuhn outlined that Fidelity currently offers six equity strategies: world, USA, Europe, emerging markets, Japan and Pacific ex-Japan.

Have developments in Ukraine changed guidelines when investing in defence

industries? “No. We have opted to exclude it. I do not think we’re changing it, but I’m not privy to that discussion, because I’m not in the sustainable committee.”

Efficient and stable product

“From a characteristic standpoint, [the active ETF] is very much like the underlying index,” argued Kuhn. He reported that 85% of the risk is driven by single security selection and therefore he thinks that “it’s one of the purest ways to deliver our research.”

Contrary to active ETFs, Kuhn argued that the usage by several passive ETFs of an ESG index bears significant deviation risk, also called basis risk. On the other hand, he argued that an “active sustainable research-enhanced ETF” can reduce the risk against the ESG benchmark compared to a passive ETF as Fidelity optimises the stock allocation while taking sustainability into account. He pointed out that once “exclusions are out of the way,” Fidelity tilts the portfolios towards ESG, but “the main driver is fundamental research.”

Besides, he stressed that contrary to investment funds, active ETF restrictions make it unlikely that the change of portfolio manager or research analyst will result in a significant dent to the investment approach. In other words, he thinks that their active funds are “more repeatable and it’s less risky.”

“ETFs are not per se passive,” said Kuhn. He often argues with clients that buying passive fixed-income ETFs is equivalent to buying active fixed-income ETFs: “you manage the portfolio actively with a goal of hitting the index performance as best as you can.” Fidelity goes one step further by arguing that: “We’re not going to hit the index. We’re trying to outperform the index.”

Active ETFs can underperform

Paperjam has often reported on the underperformance of traditional investment funds against their respective benchmarks. “It all depends on the quality of the underlying fundamental research. When you look at companies and engage with them, you should find

something the market doesn’t know.” As an active management house, he thinks that the market “isn’t totally efficient yet.”

Kuhn also provided a different perspective when looking at the underperformance issue. “These statistics take the fund performance after cost versus the benchmark in the prospectus... that’s the right thing to do if you’re looking at investments which are close to the index or trying to outperform the index only.”

However, he thinks that the approach does not capture the full picture. He argued that a dividend fund will likely use the MSCI World as the benchmark. “But as an investor, do I really care about the pure outperformance versus the MSCI World? Probably not, because you’re probably okay with an underperformance of a dividend fund on the way up. You want a defensive characteristic in that fund, so you want the fund to outperform on the way down.”

Paperjam is unclear whether performance providers such as Morningstar account for doubtful benchmarks against investment strategies when computing their statistics. On the other hand, it may be argued that it is the job of asset managers to select the best matching benchmarks, such as a dividend index in the example outlined by Kuhn.

In the meantime, Kuhn takes comfort from the current outperformance reported by the active ETFs from JPMAM and Fidelity in the US. “It is quite interesting, because everyone tells me, the US is the most efficient market, you cannot outperform it. That’s why everyone went passive.”

In addition, it is an easier sale to convince investors that the after-cost potential return is greater with fees of 20 to 35 bps for its active ETFs against around 2% for traditional investment funds.

WHAT CAN AND CAN’T GO IN AN ETF?

“What [clients] don’t like is active research that gives you plus 5% one year, minus 7% the next year against the benchmark.”

STEFAN KUHN Head of ETF distribution, Europe Fidelity International

“There’s no help in getting a properly active fund into an ETF on an exchange that trades on a 10% spread, that kind of defeats the whole purpose of the ETF,” said Kuhn. He explained that Fidelity has market makers maintaining a market on exchanges. He stressed that investors should not expect for its products a liquidity comparable to the $50bn IShares on the S&P 500. However, retail investors should expect a liquidity, or a bidoffer spread of about 20 bps, but he also suggested that one should invest with limit orders.

Fidelity’s corporate strategy

“Obviously you need to grow a lot faster on a lower margin business than what you’re losing on the higher margin business.” He thinks that it will be hard to change the “money in motion” from traditional active management to ETFs. “If you can get superior returns at a very cheap price point, it’s almost a no-brainer.” Yet he thinks that it is a short-term trend. Should that be temporary, Kuhn believes that we will see the return of active stock picking. “Remove the Magnificent 7 stocks and it is a flat line.” He commented that most fund managers he knows are “fundamentally oriented”, making it “against the grain to buy super expensive stocks.” Consequently, Fidelity continues to propose actively-managed funds

“In the US, the ETF is just a wrapper. You can wrap everything into it. You don’t have Ucits but you have the Securities Act of 1940,” said Kuhn. He received several calls from investors after the SEC approved the first bitcoin ETF, asking him whether Fidelity would do the same in Europe. Kuhn reminded investors that the Ucits regulation does not permit a single underlying security. “That’s why we have an ETP, an exchange-traded product.” Elsewhere, he argued that whether it is an active or a passive ETF, “anything you cannot trade intraday should not be in it.” A clear and uncompromising statement that goes against some ETF promoters in the US adding some banks loans while other are considering adding private debt and private equity.

such as the Global Technology Fund which does not hold direct exposure to Nvidia, for instance, but rather in companies developing software behind AI. He thinks that these alternative investments may offer a less volatile option to investors.

Contrary to the US where there is a tax advantage for owning ETFs over traditional investment funds, Kuhn thinks the other advantage, i.e., live trading, is not so much an issue with European retail and even institutional investors. “I don’t think that the market in the next few years will go all on ETFs, because I just don’t see the advantage for the end client.”

The trading advantage may be important for some investors, but Kuhn argued that it is less so for the asset allocation of long-term investors. “Waiting a day or two for your Nav [net asset valuation] isn’t as important as picking the right fund in the first place.”

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So you want to be a green investor

What precisely is green investing, what impact can individual investors make and what risks do they carry? Two investing professionals provide insights on how investors can evaluate and contribute to sustainable financial solutions.

Journalist AARON GRUNWALD

What exactly does ‘green investing’ mean? “Green investing refers to investments in companies or projects that seek to mitigate or adapt to climate change, align with environmentally aware business practices and conserve or restore nature,” said Sanela Kevric, the Luxembourg-based head of Benelux at Fidelity International, an investment firm with $925.7bn in assets under management. “It can take different forms, from investing directly in the shares or bonds of companies building climate solutions like renewables to investing in an ESG fund, which stands for environmental, social and governance, which may be much broader. For example, a company held in an ESG fund may have been selected for investment because it has good governance rather than because it is the most environmentally friendly.”

“Some funds only select those companies such as technology firms that already have low carbon footprints, which arguably does little for real-world decarbonisation,” stated Kevric. “So, investors who buy funds need to look

“Investors need to look under the bonnet of any fund they buy to ensure that it is investing in the kinds of securities they expect.”

SANELA KEVRIC Head of Benelux Fidelity International

closely at the underlying holdings to ensure they are in fact buying ‘green’ depending on what that means to them.”

“ Green investing can deliver financial returns for investors but carries risks just as general investing does,” she said. “It can also narrow the universe of investments that are available, creating ‘concentration’ risk by excluding investments in companies or sectors that may be in transition but are deemed as too high emitting to be included in the portfolio.”

According to Julien Froumouth, head of sustainability at the state savings bank Spuerkeess: “Green investing refers to the practice of allocating capital to projects and companies that either positively contribute to the environment or consider environmental criteria in addition to traditional financial performance. This includes investments in renewable energy, energy efficiency, pollution reduction and conservation of natural resources, or criteria like a company’s carbon footprint or waste management. Green investments can take multiple forms such as green bonds, green investment funds, green

Photos

International and Spuerkeess

loans or equities from companies that are deemed as green.”

Individual investors

Are the sums channelled to the markets by private savers too small to make a real difference? According to Froumouth and Kevric, individual investors actually can contribute to global climate and environmental goals. “ Yes, individual investors can make a difference , especially where they invest through funds which pool resources and spread the risk,” said Kevric. “Not only can these funds contribute to investments in climate solutions or support companies with the best environmental practices, but they can also help finance green government bonds.”

“These are bonds issued by a government whose proceeds are used to fund green investment within that country, e.g., install EV charging points or pay for solar farms. A portion of these funds may also go to fund a country’s contribution to the international Green Climate Fund, which was set up under the 2015 Paris Agreement to help developing countries develop clean power and protect themselves against climate impacts. Together these activities help the world make progress towards the goal of the Paris Agreement to keep warming to below 2 degrees.”

“The transition to a more sustainable economy will require investments at unprecedented scale,” observed Froumouth. “Each and every individual effort and contribution is key because the cost of inaction will be much higher as recent events have shown. But the main challenge is to bridge the gap between the true and strong enthusiasm of individuals for green or sustainable finance solutions and their actual financial decisions.”

“The amount of capital that could be mobilised through retail savings and investments is huge but there are barriers to overcome like perceptions of individuals regarding the availability, the profitability and the reliability of sustainable investment,” he said. “Yet, such solutions exist and deliver financial returns while also contributing to the environment.”

Is it really ‘green’?

How can individual investors evaluate if an investment is truly ‘green’ or not?

“Thanks to increasing regulations to prevent greenwashing, managers need to be more transparent about their definition and assessment of sustainable investments.”

JULIEN FROUMOUTH Head of sustainability Spuerkeess

“Investors may refrain from investing in green, sustainable or ESG financial products, because of a general lack of trust regarding the effective positive contribution of the financial solutions or due to the complexity to understand what might be qualified sustainable and the effective positive impact of the product,” Froumouth commented.

“Given the breadth of approaches to green and ESG investing, investors need to look under the bonnet of any fund they buy to ensure that it is investing in the kinds of securities they expect,” Kevric said. “Looking at the fund’s objective, investment approach and top ten holdings should tell them whether the fund is investing in climate solutions or in companies that are cutting their emissions, or both, or if the fund is taking a low-carbon approach of buying only low emitters or those with little impact or dependency on nature.”

“The EU introduced the Sustainable Finance Disclosure Regulation several years ago to increase the transparency of all EU funds,” she continued. “Funds that claim to be sustainable fall into two categories--article 8 and article 9. Article 8 funds invest in companies that have some sustainable characteristics, while article 9 funds have a sustainable objective, so typically invest in companies that aim to achieve sustainable outcomes that align with that objective.

More recently, the European Securities and Markets Authority has introduced fund naming rules to ensure funds more closely reflect their investment approaches, i.e., whether they invest in companies that are already sustainable or those that are on their way to becoming sustainable.”

Furthermore, Froumouth said that “investors could rely on ESG labels or ratings delivered by reputable agencies or institutions like Luxflag,” the Luxembourg Finance Labelling Agency. In addition, “investors could access or ask for documentation and reports, or obtain information related to the green or sustainable products made available by their banks or advisors.” At the same time, investors should track “new developments in the sustainable finance field which offer a

$4.3trn

Annual financing needed for private companies to reach the UN’s sustainable development goals. The businesses reflect a “range of sectors” and provide investors with “a rich, diverse opportunity set,” according to a Capital Group report issued in February 2024.

framework to design innovative solutions to finance the green transition.”

Portfolio manager checks

How do investment managers verify sustainability and environmental claims?

“The best practice for investments managers is to work with environmental experts to build clear, customised frameworks for assessing sustainability,” Froumouth stated. “This allows managers to build products with claims that are in line with scientific research.”

He continued: “Once the methodologies are set-up, the investments managers can run their products through specific sustainable criteria and thresholds, aligned with recognised standards, such as carbon emissions [or] water usage. To make sure that the claims are pertinent, the reliability of data, as well as its availability, is crucial. The sourcing must be done carefully, with verifications, to ensure that selected investments are objectively sustainable. For instance, managers can rely on independent third-party audits and certifications validating companies’ sustainable claims.”

Kevric explained: “an investor who is seeking investments that contribute to real-world decarbonisation might engage with companies in a hard-to-mitigate sector on the following: First, have they set credible, science-based targets for cutting their emissions? Second, do they have a transition plan in place to achieve these targets? Third, how much are they investing to make the plan happen? Fourth, how is progress measured and overseen by the company board?”

“This helps investors understand where companies are on their journey to a low-carbon future compared to their peers, and where specific transition risks lie,” she stated. “Investors may also screen out whole sectors such as oil and gas if they do not meet their criteria of what a sustainable investment is. Others may look more closely at where companies are located and if their supply chains are exposed to physical climate risks, and what mitigation a company is doing to address these.

Froumouth said that “thanks to increasing regulations to prevent greenwashing, managers need to be more transparent

about their definition and assessment of sustainable investments, pushing the industry to be more clear about its claims and its verification process. In Luxembourg, the [financial regulator] CSSF plays a crucial role in supervising the integration of ESG requirements across the financial sector.”

Accessible options

Froumouth and Kevric said there are several accessible green investing options for individual investors, in addition to green bonds. Kevric said they may want to “invest in environmental, climate or nature mutual funds or ETFs [exchangetraded funds], or invest in broader ‘transition’ funds that seek to invest in high [CO 2 ] emitters that are doing most to decarbonise themselves or others or have the most credible pathways.”

Investors could, Kevric said, “Take out a green mortgage and use some of the proceeds to make efficiency improvements to your property or add home generation like solar panels.” Froumouth flagged “green or sustainable savings accounts in which deposits are used to finance green or sustainable projects or companies,” such as plan provided by Etika, a not-for-profit ethical investment firm based in Luxembourg.

Think holistically

“ Remember a lot of green investments focus on infrastructure like renewables, which can be exposed to interest rate risk due to high upfront capital costs ,” Kevric commented. “So make sure you diversify your green investments as much as possible across different sectors and countries and be prepared for some volatility as policy and regulation continues to change. The energy transition is likely to continue to mitigate climate risks, but there will be plenty of bumps along the way.”

Froumouth said that household investors “now have to express their sustainability preferences to their banker or advisor, as the recent regulatory changes now require a mandatory holistic assessment of such clients’ profile and preferences to recommend compatible products.”

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With a strong presence in Luxembourg, Brussels, Miami, and Dubai, Altifund strategically deploys capital in and out of these regions that offer structured incentives and distinct economic advantages. Whether our investors seek long-term stability or short-term, highyield returns, our diversified portfolio is tailored to align with their evolving financial goals and strategies.

We believe in leveraging existing market advantages and capitalizing on localized investment conditions that inherently reduce market volatility. By navigating regulatory frameworks and leveraging our deep-rooted network, we structure investments that deliver sustainable growth, capital efficiency, and long-term resilience.

Our investment philosophy is built on capital preservation, sustainable growth, and strategic market expansion. With a presence in major financial hubs, we provide investors with exclusive access to global opportunities, combining deep market insights with a data-driven, risk-adjusted approach.

Our mission is to create a thriving and sustainable ecosystem for capital deployment. We go beyond delivering financial results, we drive responsible growth, harnessing our expertise to create lasting value. By meticulously selecting projects that align with our strategic vision, we generate long-term benefits for investors and stakeholders alike.

Investment strategies are designed to balance risk and return, providing stability even in dynamic market conditions. With a deep understanding of regional investment landscapes, we continuously identify exclusive opportunities that drive strong financial performance. A diverse range of asset classes tailored to investor preferences ensures flexibility and adaptability, while our access to industry-leading expertise and strategic partnerships guarantees quality investments.

Your next great investment opportunity starts here.

Ongoing real estate project in French Polynesia.

How to get started as an investor

Don’t have much cash to invest and don’t know where to begin?

Two investment advisors explain how to start investing with small amounts and share the importance of time, diversification and consistent contributions, while taking risk and the ‘big picture’ into account.

Proportion of individual investors open to using AI for investment advice, according to a Swissquote survey of 1,087 Luxembourg residents released in 2024. 25% indicated they would consider AI-based advice only after tighter regulatory frameworks are established and 24% expressed outright distrust of AI-generated investment advice. Only 3% would allow AI to manage their portfolios autonomously.

Do private individuals really need a lot of cash to start investing? “Investing doesn’t require a lot of cash to get started,” according to Jeremy Lauret, head of direct investing at Swissquote, an online financial services provider with roughly €62bn in client assets. “Nowadays, it is possible to invest even small sums without facing high costs. The main hurdles to investing are likely the ability to save enough money, understanding financial concepts well enough to make informed decisions, and having the discipline to adhere to an investment plan over time.”

“Experience is key when it comes to investing, so it is best to begin early with small amounts to gain valuable insights and be well-prepared when larger capital becomes available,” commented Georg Joucken, head of private banking at Banque Raiffeisen. “Moreover, waiting until you have a significant capital before investing may result in losing valuable time to benefit from the long-term growth potential of the markets.”

Joucken noted that “Banque Raiffeisen offers savings plans that allow investors to

start with €50 per month, providing beginners with a first experience in financial products.” Swissquote has “more than 100 exchange-traded funds (ETFs) that are free to buy, with a minimum investment of just €1,500,” Lauret stated. “Regularly investing in such a plan enables investors to gradually build capital and, in general, have a positive experience with financial markets,” said Joucken.

Time is the investor’s ally

In general, time works to an individual investor’s advantage. That’s why Joucken and Lauret said that regular and consistent contributions to an individual’s savings and investment portfolio are important. Joucken explained that “regular investing helps reduce the impact of market fluctuations by smoothing out risks. It is nearly impossible to predict the best time to invest, but by saving each month, one invests at different price levels, thereby limiting the effect of market variations.” Lauret remarked that: “Investors often make the mistake of investing more when they feel optimistic about

Journalist AARON GRUNWALD

market performance and less when they’re pessimistic, buying high and selling low. It’s generally better to ignore market noise and invest consistently.”

“Above all, it is essential to define one’s investment horizon to avoid having to sell at a loss in case of a need for liquidity,” Joucken stated. “Time is a crucial factor, especially for more volatile investments such as stocks. Historically, stock markets tend to grow over the medium and long term, helping to counter inflation and generate attractive returns for patient investors.”

“Time is a significant advantage for individual investors because of compound interest,” said Lauret. “If you start investing at 25, contributing €500 monthly could grow to €1.5m by age 65, assuming a 7.5% annual return.” Joucken provided another example: “a savings plan for a newborn, investing €50 per month at an annual rate of 3%, will result in a capital of €14,297 by the age of 18--of which €3,497, or 32%, is gained compared to the total amount invested” by their parents: €10,800. “At an 8% annual rate, the capital would reach €24,004, with a gain of €13,204, +122%, offering better financial preparation for long-term projects such as education, home purchases or retirement planning.”

Lauret added that: “Compounding only benefits you when you see positive returns on your investments, which aren’t guaranteed. Investments can fluctuate, making diversification across various asset classes crucial to mitigate risks and significant losses. Not investing at all also carries risks, as cash loses value over time due to inflation.”

Cash on hand

Many households keep a large amount of cash in their savings account. Is this a good or bad idea? How much should individuals keep in cash and how much should they dedicate to investing?

In Joucken’s view, “there is no ideal amount of cash to keep on hand, as it depends on each individual, their risk appetite and their financial goals. However, it is essential to have an emergency fund to handle unexpected expenses or cover planned expenditures. On the other hand, holding too much cash can lead to a loss of purchasing power, as savings account returns are generally lower than inflation.”

“While it’s important to have cash on hand for emergencies, statistics show that the average European household held 41.1% of its financial wealth in cash and bank deposits in 2022, according to the European Fund and Asset Management Association, which could be considered excessive,” said Lauret. “Households should indeed keep enough cash in their savings to cover unforeseen expenses, but this amount should be tailored to individual circumstances. Factors like job security, the need to support family members, or maintaining a fund for home repairs can vary greatly from one household to another.”

After establishing an emergency reserve, “it is often preferable to invest any excess funds in assets that offer better potential returns, such as investment funds, stocks or bonds,” Joucken said. “Additionally, most financial products offer good liquidity, allowing investments to be quickly converted into cash if needed.”

Beyond savings accounts

What are some alternative options to the classic savings account? “For alternatives to traditional savings accounts, there’s no perfect match for emergencies in terms of safety and access,” said Lauret. “However, for those comfortable with taking on additional risk, there are several options like bond funds or ETFs that could potentially offer higher returns. In periods of stock market turbulence, bonds often behave inversely to stocks, providing a potential source of liquidity without the need to tap into savings.”

“Bond funds, for instance, can deliver income exceeding that of a conventional savings account, particularly once interest rates have peaked,” Lauret pointed out. “Investors might consider constructing a portfolio of high-quality government bonds, spread across various maturities. Shorterterm bonds, with their brief remaining term, carry less price volatility risk than their longer-term counterparts, serving as a feasible savings alternative, though they don’t guarantee the return of all capital.”

“Another liquidity option is Lombard loans, which enable borrowing against one’s investment portfolio without liquidating assets, thus preserving potential for capital gains and income,” Lauret said. “However, like any form of credit, Lombard

JARGON

BUSTERS

ALPHA AND BETA

Alpha measures a company’s or a portfolio manager’s ability to generate returns above the market average. Beta brings risk into the equation.

AMORTISATION

Either a schedule to repay the principal and interest on a loan, or an accounting practice of spreading capital expenditures out over a period of time.

COMPOUND INTEREST

Essentially ‘interest on interest’, it refers to earning interest on both the principal and the interest accumulated over time, which increases or compounds with each interest or dividend payment.

DOLLAR COST AVERAGING

By setting aside the same amount of money for investment on a regular basis, over the long term, investors will end up paying the right price for their portfolio.

ETFs

Exchange-traded funds automatically track an index or type of financial asset, and can be bought or sold in real time on the stock market. Many investors put their savings in ETFs because they typically have lower management fees.

KID

The EU requires a standardised key information document to be provided to potential investors in mutual funds and other investment products, outlining the investment, risk, expected performance, fees and other essential details.

LIQUIDITY

How easily an asset, such as a stock or property, can be converted into cash without impacting its market price.

MIFID

The Markets in Financial Instruments Directive are EU rules that mandate transparency in transaction costs and trading data and require financial advisors to understand clients’ sustainable investment preferences.

TRACKING ERROR

The difference between the performance of a stock, bond or portfolio compared with a benchmark.

loans come with risks and are generally suited for well-qualified investors.”

Joucken said “it is advisable to seek guidance from a professional who can recommend solutions tailored to the client’s risk profile and sustainability preferences, while also considering their knowledge and experience.”

Exchange-traded funds

What are ETFs and what type of investor should use them? “Exchange-traded funds are investment vehicles that generally track an index or a basket of securities,” Lauret explained. “They are listed on stock exchanges, allowing for trading at any point during market hours. Most ETFs are passively managed, meaning they mimic indices like the Nasdaq, Dax 30 or Eurostoxx 50, rather than relying on active management where portfolio managers pick investments they believe will outperform the market.”

“ETFs have grown significantly in popularity worldwide, and with a vast array of types available, they cater to nearly every investor’s needs,” Lauret stated. “For those new to investing, ETFs can serve as the foundational elements of a portfolio, providing exposure to both domestic and international equity and fixed-income markets. Some ETFs even offer a balanced mix of global equities and bonds within a single fund.”

Investors can use ETFs to balance out the other investments in their portfolio. “For example, if an investor’s workplace pension only includes European assets, they could supplement this by investing in ETFs that offer exposure to international bonds or equities,” Lauret said.

“The ETF itself does not indicate its risk level--it is the choice of the underlying index that determines its volatility and potential return,” Joucken observed. In addition, “for inexperienced investors, it is advisable to seek professional guidance, as some ETFs can be complex and highly risky. Certain ETFs, for example, use leverage or involve complex financial instruments such as derivatives.”

Long-term approach

What are some other suggestions for investors who are just getting started? “While

costs shouldn’t be your only consideration, they are a crucial factor in ensuring you retain the majority of your investment returns,” Lauret suggested. “Be vigilant about custo dy fees, which can erode your portfolio’s performance year by year. They might appear negligible when you first start investing, but as your portfolio grows through contributions and investment gains, these fees accumulate into a significant sum.”

“Also, beware of costly investment products,” Lauret added. “Some investment funds come with high management fees and retrocessions [editor’s note: sales commissions] that benefit the banks distributing them, which can markedly diminish your investment’s annual performance.”

Joucken shared seven principles that will help investors “gradually build a strong financial portfolio while minimising risks.” They are: “Diversify your investments: Avoid concentrating all your capital in a single asset or sector. Respect your investor profile: Assess your risk appetite and sustainability preferences before investing. Set an investment budget: Do not invest funds allocated to short- or medium-term expenses or projects. Invest in products you understand: Always ensure you fully understand the characteristics and risks of an investment before committing. Stay calm: Avoid impulsive reactions to market fluctuations. Don’t get discouraged after a first bad experience: Investing is a long-term strategy. Seek professional advice: An expert can help structure an investment strategy tailored to your profile and objectives.”

Photos Marie Russillo

TUESDAY 25.11.2025

18:00 – 22:30 GridX, Wickrange

by PAPERJAM and LUXEMBOURG FOR FINANCE

Cocktail — International keynote speaker — Awards ceremony — Seated dinner

This bi-annual event, organised by Paperjam and Luxembourg for Finance, honors outstanding players in the financial sector who exhibit excellence, exceptional expertise, and significant contributions to the future of the Financial Centre. The winners will be announced during a gala dinner. With the participation of The Minister Gilles Roth (Minister of Finance) and Tom Théobald (CEO of Luxembourg for Finance).

La crypto, un univers à part

Les années passent mais l’univers de la crypto reste un univers à part où les bons conseils de l’investissement « classique » ont toujours une valeur particulière.

S’éduquer, le b.a.-ba.

Journaliste THIERRY LABRO

« Tytanik » – quel pseudo ! – l’avait prédit sur BitcoinTalk dès 2011 : le cours du bitcoin a dépassé les 100.000 dollars. C’était le 17 décembre 2024 pour la première fois. Chaque nouvelle secousse de la première cryptomonnaie de l’histoire a entraîné son lot d’incrédules, de nouveaux adeptes et de haussements d’épaules pour désigner un système de Ponzi ou se plaindre qu’on ne prête pas davantage attention à la blockchain, technologie sous-jacente de ces produits et qui pourrait être utile pour bien d’autres choses. Chaque nouvelle hausse a suscité de nouvelles vocations d’investisseurs du dimanche. En 15 ans, le Far West de la crypto est resté le Far West de la crypto… mais un certain nombre d’acteurs ont essayé de faire les choses bien et le Luxembourg a été en pointe de la régulation pour rassurer ceux qui voudraient y dépenser une partie de leurs économies. Avant de commencer, comme pour beaucoup d’autres investissements, mieux vaut savoir qui l’on est : un investisseur prudent, qui préfère le bitcoin ou l’ethereum sur du long terme, un investisseur intermédiaire qui explore les autres coins et le staking pour générer des revenus passifs ou encore un trader actif, qui pratique le daily trading ou le swing trading en

espérant tirer parti de la volatilité extrême de certains actifs.

Stratégies crypto : choisir entre stabilité, performance et risque Chacun de ces trois profils s’accompagne d’avantages et d’inconvénients. Le conservateur « hodl » (« hold on for dear life ») sera moins stressé par les fluctuations quotidiennes, parfois spectaculaires, et pourra bénéficier, au Luxembourg, d’une exonération fiscale des plus-values après six mois de détention pour autant qu’il puisse documenter cette détention… mais les fonds peuvent être immobilisés pendant de longues périodes.

Le à peine plus audacieux « dollar-cost averaging » investit de petites sommes à intervalles réguliers et réduit les risques d’acheter au mauvais moment mais bénéficiera de performances moindres. Le « buy the dip », déjà plus expérimenté, achète après une forte correction du marché en visant une forte plus-value… à condition de savoir identifier un vrai creux et de ne pas acheter trop tôt. Deux autres profils nécessitent déjà une meilleure compréhension des dynamiques et certains réflexes, que ce soit le stakeur qui peut générer des revenus passifs de 5

L’ÈRE DES TOKENS

Il y a les « monnaies » mais aussi des tokens, qui peuvent représenter différentes choses. À Luxembourg, ANote Music commercialise ainsi des droits de catalogue musicaux sur une sorte de bourse secondaire, LetzToken des droits de propriété sur de l’immobilier et Stokr dans le cadre de projets de financement d’entreprise. Ailleurs, parmi les plus connus, on trouve aussi des parts de tableaux chez Masterworks, des cartes de membres de clubs de supporters de football chez Fan Tokens ou même des produits dérivés de crédit carbone. À chaque fois, le même principe : rendre plus liquides des actifs financiers normalement bloqués pour des années.

Photo ANote Music, Romain Gamba (archives) et Matic Zorman (archives)

$Trump

Le 17 janvier 2025, quelques jours avant son investiture, Donald Trump a lancé sa propre cryptomonnaie, le $ Trump, un « meme coin » basé sur la blockchain Solana. Un milliard de jetons ont été créés, dont 200 millions mis en vente initialement, les 800 millions restants étant détenus par deux entreprises affiliées à Trump, CIC Digital LLC et Fight Fight Fight LLC, avec une libération prévue sur trois ans. Ce qui affole les régulateurs qui crient au conflit d’intérêts, tandis que l’engouement initial pour l’initiative témoigne bien de la manière dont les dynamiques se développent.

Source CoinMarketCap

à 15 % par an mais dont les fonds peuvent être bloqués ou à risque sur des plateformes centralisées ou celui qui dépose des cryptos dans des protocoles de DeFi pour obtenir des intérêts.

Où commencer ? Faisons simple. Il y a plus de dix ans que le Luxembourg a commencé à réguler certaines plateformes, c’est peut-être là qu’il serait le plus judicieux de commencer à s’intéresser au bitcoin. Les formulaires d’inscription sont toujours à peu près les mêmes, il faut passer le sacro-saint KYC avant de pouvoir déposer une somme en euros depuis son compte bancaire ou d’utiliser une carte de crédit et de pouvoir acheter ses premiers bitcoins.

Les plateformes crypto régulées à connaître

On retrouve ces acteurs régulés au Luxembourg Bitstamp, qui propose 131 « devises » et la commission à payer varie selon le montant « tradé » au cours des derniers 30 jours ; ou Bitflyer. Mais il est aussi possible d’acheter des cryptos chez Swissquote, Binance, Coinbase, Kraken

ou, pour les plus expérimentés, OKX ou Bybit. Ainsi qu’auprès des néobanques, que ce soit Revolut, N26 ou Trade Republic. Comme dans la banque traditionnelle, plus le nom est connu sur la Place, plus il rassure et permet de faire ses premiers pas dans de bonnes conditions.

L’autre aspect est que ces entreprises ont des solutions de stockage de vos cryptos et vous évitent des portefeuilles en ligne, comme Metamask ou Trust Wallet, ou des cold wallets comme Ledger – également supervisée par la CSSF –, l’équivalent pour les cryptos d’un disque dur pour la photo. Avec tous les risques qui sont associés à ces technologies, que quelqu’un vide votre portefeuille en ligne après avoir trouvé vos codes quelque part ou que vous perdiez votre cold wallet , comme James Howells, ingénieur en informatique de 35 ans au Pays de Galles qui a jeté son disque dur contenant 7.500 bitcoins en 2013 – pour une valeur alors de 280 millions de dollars à l’époque (3,8 milliards aujourd’hui).

HUIT QUESTIONS POUR TÊTE BRÛLÉE

Envie de prendre davantage de risques en allant chercher des produits qui semblent plus juteux et aux charmes souvent vantés sur les réseaux sociaux ? Commencez alors par utiliser l’authentification à deux facteurs, des mots de passe complexes et uniques et à ne pas cliquer sur des liens suspects envoyés par e-mail pour essayer de protéger votre portefeuille. Puis préparez une due diligence des temps modernes :

Le projet a-t-il un audit de sécurité (chez Certik ou Hacken par exemple) ?

Le white paper – qui n’a pas la valeur juridique d’un prospectus boursier – est-il plus long que quatre pages ?

Moins pourri de fautes d’orthographe ?

Dans votre langue ?

Et l’équipe qui y est présentée existe-t-elle ?

A-t-elle par exemple un profil LinkedIn ?

Comment est présentée la mise sur le marché des tokens ?

Les développeurs peuvent-ils retirer la liquidité (via Token Sniffer) ?

Trop de « non » devraient vous inciter à dire… « non ».

FRIDAY

JULY 11th, 2025

Across the city’s best terraces

READY FOR THE ULTIMATE EXPAT RALLY?

Discover Luxembourg in 10 epic stops, 10 vibrant terraces, and endless fun!

Connect with the community, explore the city, and collect visas at each stop in your Paperjam Passport!

Games, challenges, and surprises await at every stop! Collect as many visas as possible to win incredible prizes and join 5,000+ participants for an event filled with laughter, discovery, and connection.

Faites fructifier votre épargne : conseils d’experts

L’épargne, longtemps perçue comme une simple réserve de sécurité, doit aujourd’hui être envisagée sous un prisme plus stratégique, comme l’expliquent le responsable du département Retail & Professional Banking de Spuerkeess, Claude Hirtzig, et la responsable de l’offre BGL BNP Paribas Banque Privée, Anne-Françoise Woolf.

2,75 %

En janvier 2025, la Banque centrale européenne (BCE) a abaissé ses taux d’un quart de point après quatre baisses en 2024, ramenant son taux de dépôt à 2,75 %. D’autres baisses devraient suivre, alors même que le choix de la Réserve fédérale (FED) a été de faire une pause.

Dans un environnement économique en constante évolution, marqué par des fluctuations des taux d’intérêt, une inflation qui reste sous surveillance et des incertitudes sur les marchés financiers, la question de l’optimisation de l’épargne est plus que jamais d’actualité. « Au cours de ces deux dernières années, nos clients ont eu tendance à augmenter leurs placements monétaires, rendus très compétitifs par la hausse des taux, par rapport aux autres placements à taux fixes. Aujourd’hui, dans une perspective de baisse de taux en Europe, nous pensons qu’il est temps de redéployer une partie de ces liquidités de façon plus optimale vers des solutions à plus long terme », confie la responsable de l’offre BGL BNP Paribas Banque Privée, Anne-Françoise Woolf.

Une épargne traditionnellement liquide, mais en mutation

D’une manière générale, les Luxembourgeois ont toujours marqué une préférence pour l’investissement cash ou très liquide. « L’explication est à chercher à plusieurs niveaux. Tout d’abord, nous avons un système de retraite plutôt généreux, qui

n’incite pas à prendre des risques ni à faire travailler son épargne. En corollaire, l’attrait pour l’éducation financière, pour se familiariser avec d’autres outils d’investissement, est resté relativement faible, constate le responsable du département Retail & Professional Banking de la Spuerkeess, Claude Hirtzig. Dans le cadre de la réforme des retraites en discussion aujourd’hui, il est important de remettre en question ce comportement. Nous observons d’ailleurs une mutation progressive, notamment avec l’arrivée de nouveaux résidents, plus familiers avec les marchés financiers, venus de pays où il est important de se constituer un capital pour la retraite. »

Aujourd’hui, une part croissante de la population s’intéresse à l’investissement à long terme et à la prévoyance. « Une des préoccupations majeures des jeunes qui viennent travailler au Luxembourg, en termes de besoins bancaires, n’est pas le financement immobilier, mais plutôt l’investissement, l’épargne à long terme et la prévoyance. Nous observons un changement de mentalités très net. Précédemment, les résidents se constituaient une épargne pour couvrir les dépenses à court terme et

Auteur MICHAËL PEIFFER

surtout pour financer une première acquisition immobilière. Or, la possibilité de devenir propriétaire s’éloigne pour de nombreux clients qui sont donc prêts à prendre un petit risque avec leurs réserves de cash », poursuit Claude Hirtzig.

Depuis le dernier cycle de hausse des taux amorcé par la BCE, à partir de juillet 2022, les banques ont constaté un très net regain d’intérêt pour les dépôts à terme, qui ont capté une part importante de l’épargne. « Avoir une discussion sur les dépôts à terme avec nos clients permet également d’aborder d’autres solutions comme les placements en titres, et de les familiariser avec ces sujets. D’ailleurs, maintenant que les taux redescendent, ces mêmes clients migrent leurs avoirs des dépôts à terme vers des fonds d’investissement diversifiés, même si ces positions

restent très conservatrices », constate encore le responsable de Spuerkeess.

Des solutions adaptées à chaque profil d’investisseur

Pour ceux qui souhaitent débuter dans l’investissement, des solutions accessibles existent. « Un plan d’investissement régulier en titres peut être mis en place dès 40 ou 50 euros par mois , explique Claude Hirtzig. Cela permet de se familiariser avec les marchés sans prendre de risques excessifs. Commencer par de petits montants est souvent rassurant, et cela permet de mieux comprendre comment fonctionne l’investissement sur le long terme. »

LES GRANDES TENDANCES 2025

UN CONSEIL ROBOTISÉ, DÈS 500 EUROS

« La possibilité de devenir propriétaire s’éloigne pour de nombreux clients qui sont donc prêts à prendre un petit risque avec leurs réserves de cash. »

CLAUDE HIRTZIG

Responsable, Département Retail &

Les outils digitaux facilitent également l’accès aux investissements. « Aujourd’hui, un simple smartphone suffit pour démarrer grâce aux robo-advisors, ajoute-t-il. Ces solutions automatisées réalisent un profilage et recommandent une allocation idéale selon les objectifs du client. Le but est de rendre l’investissement accessible à tous, sans nécessiter de connaissances financières avancées. » Pour les clients retail qui souhaitent bénéficier d’un accompagnement plus poussé, la Spuerkeess propose une solution de gestion discrétionnaire, accessible dès 25.000 euros. « Cette approche permet aux investisseurs d’accéder à une gestion professionnelle sans avoir à suivre quotidiennement l’évolution des marchés. Une fois le profil du client établi, nos experts s’occupent de la répartition de son capital et ajustent les investissements en fonction des conditions du marché, garantissant ainsi une allocation optimisée et adaptée à ses objectifs financiers. »

Vers une allocation optimisée : diversification et projection Aujourd’hui, le conseil en épargne financière est au cœur de la relation entre un client et sa banque. « Tout conseil en investissement ou de construction de portefeuille doit s’adapter aux projets propres à chaque client, son appétit pour le risque, ses espérances de rendement, sa compréhension des sujets financiers, ses convictions personnelles et, de plus en plus, le souhait d’épargner et d’investir de façon responsable  », partage Anne-Françoise Woolf, pour qui construire un portefeuille efficace repose sur une approche structurée et équilibrée.

La solution d’investissement Speedinvest de Spuerkeess s’appuie sur les conseils d’un robo-advisor. « La solution se veut très simple. En une dizaine de clics, le robot détermine le profil investisseur du client qui choisit ensuite le montant qu’il souhaite investir, à partir de 500 euros », explique le responsable du département Retail & Professional Banking de la Spuerkeess, Claude Hirtzig. En fonction de la stratégie retenue, l’argent sera placé dans deux compartiments de fonds d’investissement, de type obligataire et actions, composés majoritairement d’ETF, qui investissent à leur tour de manière diversifiée dans les marchés boursiers internationaux ainsi que dans des obligations libellées en euros et en dollars. « Cette solution permet de franchir un premier pas, de manière ludique. Vous voyez en direct votre investissement fluctuer, au rythme des marchés. »

QUELLE STRATÉGIE ?

« Pour 2025, nos experts identifient plusieurs axes stratégiques à privilégier, explique Anne-Françoise Woolf. Tout d’abord, nous conseillons de miser sur la baisse des taux directeurs qui devrait soutenir les classes d’actifs à effet de levier tels que l’infrastructure ou le private equity. La remontée des taux longs depuis décembre dernier constitue une opportunité pour investir dans les obligations de bonne qualité ou les produits structurés à capital garanti. » La responsable de l’offre BGL BNP Paribas Banque Privée conseille également d’investir dans les infrastructures technologiques, énergétiques et tous les secteurs qui contribueraient à leur fonctionnement, de diversifier les portefeuilles avec des produits décorrélants pour éviter une concentration sur les grandes valeurs technologiques américaines. « Il s’agit également de monétiser l’intelligence artificielle en investissant dans des sociétés technologiques et industrielles. Enfin, la question du bien-vieillir est devenue un enjeu de société. Investir dans les secteurs pharmaceutiques, de la biotechnologie et des technologies médicales s’inscrit dans cette lignée. »

Selon l’Étude annuelle de l’ABBL sur le marché de la banque de détail 2022, de manière générale, on remarque que les clients locaux restent très conservateurs, les comptes courants, comptes épargne et comptes à terme représentant toujours 86 % des dépôts.

« Tout conseil en investissement ou de construction de portefeuille doit s’adapter aux projets propres

« Au départ, investir à long terme nécessite de faire une projection de ses besoins, afin de déterminer la part qui devra couvrir les besoins en liquidités et celle qui couvrira le besoin en rendement pour un accroissement du capital. »

Ensuite, l’investisseur débutant doit construire son portefeuille en commençant par les fondations, une base solide qui vise un rendement stable. « À cette base, on va ajouter des couches d’opportunités en fonction de l’évolution des marchés et des préférences du client. On pourra investir en obligations, actions, produits structurés et, au cas par cas, aller vers des placements plus sophistiqués tels que le private equity, l’infrastructure ou l’immobilier non coté», explique Anne-Françoise Woolf.

L’allocation stratégique, qui consiste à définir le poids des différentes classes d’actifs dans un patrimoine en raisonnant à long terme (5 à 10 ans), tout en tenant compte du profil du risque du client et de ses projets, est la première étape du processus. « Cette allocation stratégique représente à elle seule 77 % de la performance obtenue. Les autres facteurs qui entrent en jeu sont la sélection des supports pour 10 %, le timing d’investissement pour 7 % et enfin l’allocation tactique pour 6 %, détaille la responsable de l’offre BGL BNP Paribas Banque Privée. L’allocation tactique, par opposition à l’allocation stratégique, est un choix de gestion de portefeuille à plus court terme. L’objectif est de profiter d’une période de surperformance d’une classe d’actifs sur un horizon de temps qui est en général de six à douze mois. »

Une volonté de simplification des solutions

En gestion sous mandat, en complément de l’allocation stratégique, toutes les étapes d’allocation tactique, de choix des supports, de market timing, ou encore de pilotage du risque, sont prises en charge par le gérant. « Il s’agit d’une solution clé en main. En revanche, si le client ne souhaite pas totalement déléguer la gestion de ses investissements, il peut, via la gestion-conseil, obtenir des avis et recommandations pour construire et gérer son portefeuille finan », souligne Anne-Françoise Woolf. Aujourd’hui, l’objectif est à la simplification de l’investissement. « On part du constat que le client ne se lève pas chaque

matin en voulant acheter un produit bancaire. Nos ambitions sont élevées et nous pensons que l’aspect épargne retraite va devenir très important à l’avenir, mais notre rôle est d’abord de bien informer notre clientèle afin qu’elle soit capable de prendre les bonnes décisions  », précise

Claude Hirtzig.

Pour le petit épargnant comme pour le client plus fortuné, le critère principal n’est pas le moment où il faut investir, mais bien le rythme d’investissement. «  Nous sortons d’une excellente année et l’investisseur peut se dire qu’il doit investir plus ou, à l’inverse, vouloir vendre parce que la situation favorable ne va pas durer. C’est à ce moment-là qu’il faut discuter avec son conseiller. Il faut aussi redéfinir son profil de risque à intervalles réguliers ou lorsque la situation financière de la personne change, de manière positive ou négative d’ailleurs », conseille le responsable du département Retail & Professional Banking de la Spuerkeess.

Se lancer dans l’investissement peut sembler complexe, mais des solutions existent pour simplifier cette première étape, qui ouvre ensuite le champ des possibles.

Être bien conseillé, mieux investir

Que l’on cherche à bien gérer son épargne, à faire ses premiers pas sur les marchés ou à développer des stratégies d’investissement élaborées, il est recommandé d’investir en étant bien accompagné. Ne négligez pas l’apport d’un conseil de qualité.

SÉBASTIEN LAMBOTTE

Quand il est question d’argent, et notamment de veiller à préserver et à faire fructifier son patrimoine, on est souvent bien démuni. Que rapporte l’épargne conservée sur un compte en banque ? Bien moins que l’inflation. Au fil du temps, le cash subit donc une dévaluation. Pour celui qui cherche à gérer ses finances en bon père de famille, il est dès lors important de veiller à faire travailler son épargne. Oui, mais comment ? À partir de quel moment faut-il envisager d’autres options de placement, et lesquelles ? Lorsque l’on commence à se constituer un patrimoine ou si l’on souhaite démarrer à investir, il est bon de pouvoir s’appuyer sur un conseil ler avisé. Oui, mais vers qui se tourner ?

La méfiance est de mise

En quelques clics sur Internet, chacun trouvera certainement des sites remplis de recommandations en matière d’inves tissement. Toutefois, la méfiance s’impose, notamment vis-à-vis d’acteurs peu scru puleux, prêts à tout pour vous soutirer une partie de votre épargne.

« Il faut en effet que chacun garde en tête un principe de base lié à l’investissement : la promesse de rendements élevés implique une prise de risque importante, assure le président de la Luxembourg Association of Family Offices, Pascal Rapallino. Si l’on

«Sur le long terme, le marché des actions offre des rendements attrayants. Le secret, c’est la diversification et la planification.

vous promet des rendements importants sans prise de risque, partez en courant. L’arnaque n’est jamais très loin. Investir, cela ne s’improvise pas, et il est important d’être bien conseillé, quel que soit le niveau de patrimoine dont on dispose. »

La mise en garde faite, vers qui peut-on se tourner ? Tout le monde n’a pas accès à une expertise en gestion patrimoniale. Un conseiller bancaire, en agence, est dès lors sans doute le premier interlocuteur apte à vous aider. Et il n’est d’ailleurs jamais trop tôt pour prendre conseil.

« Chaque cas est différent, explique le head of retail banking au sein de la Bil, Cédric Weisse. Chaque individu entretient un rapport différent à l’épargne et à l’investissement. Dès le départ, il est important de prendre le temps de la réflexion, en partant des besoins et des attentes, en faisant preuve d’une grande pédagogie, pour structurer la démarche et s’assurer que l’épargnant ou l’investisseur a conscience des opportunités mais aussi des risques qui y sont associés. »

Pouvoir faire face à l’imprévu

Le premier rôle de l’épargne, dans beaucoup de cas, est de permettre à chacun de faire face à l’imprévu. Sur un compte courant ou d’épargne, l’argent demeure directement accessible. Il peut être retiré aisément pour remplacer, le cas échéant,

Photo Romain Gamba (archives) et Bil

Auteur

une voiture, une chaudière ou une machine à laver, ou encore pour subvenir aux besoins de la famille en cas de perte d’emploi.

« D’une personne à l’autre, le montant que l’on souhaite garder sur un compte, permettant à chacun de se sentir en sécurité, peut sensiblement varier, assure Cédric Weisse. Pour certains, l’équivalent d’un mois de revenus suffit, tandis que d’autres souhaiteront disposer en permanence de six ou douze mois de salaire. À ce niveau, il faut être à l’écoute du client, comprendre ses besoins et contraintes, afin de trouver le bon équilibre. »

Les services de conseil en investissement sont aujourd’hui très réglementés afin de garantir un haut niveau de protection à l’épargnant/investisseur. Le conseiller, dès lors, n’est pas là pour vous vendre des produits à tout prix.

« Le premier objectif, pour un conseiller, sera de faire un état des lieux de la situation financière du client. En s’appuyant sur des méthodes éprouvées et des outils performants, il s’agit d’établir un profil de l’épargnant, qui tient compte de sa capacité d’épargne, de son appétence au risque et de ses projets , explique Cédric Weisse. La dimension temporelle joue aussi un rôle majeur. S’inscrire très tôt dans une démarche d’épargne, en veillant à mettre de côté régulièrement, selon le mécanisme des intérêts composés (voir encadré), permet de profiter de gains conséquents. »

Faire fructifier l’épargne

S’il est important de se constituer un « bas de laine », il est donc conseillé de chercher à le faire fructifier. Il existe pour cela des formules offrant des rendements, certes modestes, mais sans risque.

« Les acteurs bancaires proposent diverses formules liées à l’épargne, commente Pascal Rapallino. Si, au Luxembourg, il n’existe pas d’équivalent au Livret A français (qui permet de profiter d’un taux d’intérêt fixé par l’État, actuellement de 2,4 %), les acteurs bancaires offrent des taux d’intérêt supérieurs à celui d’un compte épargne, notamment à travers des dépôts à terme. Ces produits, qui impliquent d’immobiliser une partie de son épargne sur des périodes préalablement déterminées, garantissent une sécurité quasi absolue. »

Certains produits, comme l’épargnepension ou l’épargne logement, offrent

aussi des leviers d’optimisation fiscale qu’il ne faut pas négliger.

De l’épargne à l’investissement

Toutefois, le champ des possibilités pour faire fructifier son patrimoine ne se limite pas aux produits d’épargne. La démarche d’investissement offre des perspectives de rendement plus attrayantes, bien qu’elle comporte évidemment certains risques.

« Avant d’investir, il faut pouvoir épargner, rappelle Cédric Weisse, qui recommande d’y aller étape par étape. Une fois que l’on a veillé à optimiser fiscalement son épargne, plusieurs options peuvent être envisagées en fonction de la capacité d’investissement de chacun. Notre rôle sera de l’inviter à se positionner sur les marchés en lui proposant des produits adaptés. »

La démarche, si elle s’inscrit dans la suite logique des choses, implique de prendre en considération de nombreux autres éléments.

« Il est en effet essentiel que chacun dispose d’une bonne compréhension des produits dans lesquels il investit et, en fonction de cela, se tourne vers les personnes les plus à même de le conseiller. La règle d’or, dans toute démarche d’investissement, c’est la diversification, explique Pascal Rapallino. Plus son patrimoine s’étend, plus la palette de produits accessibles s’élargit. Il faut donc veiller à continuer à diversifier entre des placements sûrs, qui génèrent régulièrement des dividendes, et des investissements offrant des rendements plus importants dans une perspective à long terme, comme les actifs privés. »

Opter pour des produits adaptés

Selon la capacité d’investissement du client, son profil de risque et son horizon de placement, le conseiller pourra l’orienter vers les produits les plus adaptés. L’une des solutions pour faire ses premiers pas sur les marchés consiste à investir dans des fonds diversifiés, dont la gestion est assurée par la banque ou des gestionnaires d’actifs. Dans cette optique, une institution comme la Bil propose une gamme de produits répondant à la diversité des profils des investisseurs qu’elle accompagne. « Chaque fonds d’investissement géré par la banque va investir sur les marchés dans diverses actions, obligations ou encore

COMPRENDRE LES INTÉRÊTS COMPOSÉS

Épargner sur le long terme, même avec des taux d’intérêt modestes, permet d’accumuler des gains conséquents. Pour celles et ceux qui n’auraient jamais entendu parler des intérêts composés, une petite leçon d’éducation financière s’impose.

RÉINVESTIR LES INTÉRÊTS

On a recours à ce concept pour désigner la démarche d’un investisseur (ou épargnant) qui veille à faire fructifier son épargne, mais aussi les fruits qu’elle permet de générer. Autrement dit, il place ou réinvestit les intérêts (ou dividendes) engrangés au fil du temps. Sur une longue période, on découvre que cela fait une grande différence.

SUR 20 ANS

Prenons l’exemple d’une personne qui, dès 40 ans, décide de placer 50 euros par mois dans un produit assurant un taux d’intérêt annualisé de 4 %. Au bout de 20 ans, avec les intérêts composés, la valeur totale du placement s’élèvera à 18.338  euros. Les intérêts, autrement dit la plus-value, s’établiront à 6.338 euros (soit près d’un tiers du montant global).

SUR 40 ANS

Prenons maintenant un jeune, qui s’inscrit dans la même démarche dès ses 20 ans et qui place le même montant chaque mois, au même taux annualisé (4 %), mais sur une période de 40 ans. Lorsque notre épargnant avisé célèbrera son soixantième anniversaire, le montant total accumulé s’élèvera à 59.098  euros. La part des intérêts générés au fil du temps, nettement plus conséquente, sera de 35.098 euros (soit plus de 50 % du montant global).

UNE CROISSANCE EXPONENTIELLE

Le fait de réinvestir les intérêts fait que le patrimoine épargné progressivement croît plus rapidement (générant dès lors davantage d’intérêts), suivant une courbe exponentielle. S’il faut dès lors retenir un conseil, ce n’est pas de miser gros, mais de commencer tôt.

devises selon une stratégie préalablement établie. Certains mettront en œuvre des approches plus agressives, d’autres auront des profils plus défensifs, commente Cédric Weisse. Certains produits se concentreront sur des actions européennes, tandis que d’autres auront une dimension plus globale. L’établissement du profil de l’investisseur, que tout conseiller en investissement est tenu de réaliser, permet d’orienter chacun vers les produits qui lui correspondent. »

L’avantage de ces produits réside dans le fait que l’investisseur n’a pas à se soucier de la gestion de son portefeuille. Le gérant du fonds effectue régulièrement des arbitrages pour rééquilibrer le portefeuille en ligne avec la stratégie définie.

Comprendre les produits

Investir sur les marchés comporte effectivement des risques. Le conseiller, cela dit, est là pour permettre à chacun de les comprendre. La notion d’horizon d’investissement est en l’occurrence déterminante et doit être considérée au même titre que le risque.

INVESTIR DANS LES CRYPTOS : BONNE

OU MAUVAISE IDÉE ?

Acquérir des cryptomonnaies s’effectue aujourd’hui très facilement. En 2024, la valeur du bitcoin a plus que doublé. De quoi susciter de l’intérêt. Investir dans les cryptos, estce une bonne ou une mauvaise idée ? « C’est une classe d’actif à part entière, répond Cédric Weisse. Le risque est important, il faut l’envisager en connaissance de cause. »

«Il est essentiel que chacun dispose d’une bonne compréhension des produits dans lesquels il investit et, en fonction de cela, se tourne vers les personnes les plus à même de le conseiller. »

PASCAL RAPALLINO

Président

Luxembourg

Association of Family Offices

« Une correction des marchés, plus ou moins importante, est toujours possible. Cependant, les principaux indices boursiers ont toujours effacé les pertes pour revenir en territoire positif, explique Cédric Weisse. Sur le long terme, le marché des actions offre des rendements attrayants. Le secret, c’est la diversification et la planification. » Il faut aussi pouvoir garder la tête froide. L’émotion est mauvaise conseillère. Face à une correction, il est recommandé de faire le gros dos et d’attendre des jours meilleurs, ou de profiter du moment pour saisir des opportunités d’investissement.

L’importance du suivi

C’est dans ces moments qu’il faut aussi se tourner vers son conseiller.

«  Le suivi de ses investissements a son importance, précise Cédric Weisse. Il est intéressant de retourner régulièrement voir son partenaire pour faire le point et éventuellement réorienter la stratégie. Nos besoins, notre situation, nos projets évoluent au fil du temps. Il faut les adapter. »

Certains investisseurs, avec l’expérience, vont se montrer plus aguerris. Disposant de meilleures connaissances du fonctionnement des marchés, ils seront tentés de gagner en autonomie. En la matière, d’autres formules d’accompagnement et de conseil existent.

Si le client peut justifier de connaissances suffisantes, il peut aussi investir directement dans les produits de son choix, assure le responsable de la Bil. Il peut également s’appuyer sur un mandat de gestion-conseil. Il opère ses choix en s’appuyant sur un échange régulier avec ses conseillers. Ces offres, cependant, relèvent

de la banque privée, comme nos solutions de gestion discrétionnaire, qui répondent à une stratégie adaptée au client. »

Mobiliser les bonnes expertises

L’élargissement de son patrimoine peut permettre à l’investisseur d’accéder à d’autres produits, plus complexes et plus risqués.

« Selon ses besoins, il pourra se tourner vers des solutions plus adaptées, comme celles offertes par les acteurs de la banque privée ou par les family offices , ajoute Pascal Rapallino. Là, il pourra s’appuyer sur des expertises en gestion et en planification patrimoniale, ou sur des conseillers spécialisés dans des produits spécifiques, à même de l’accompagner dans ses démarches d’investissement en private equity ou dans l’immobilier, par exemple. Ces approches, en effet, peuvent impliquer d’aller chercher des solutions de financement adaptées et d’envisager des structurations plus ou moins complexes. »

Investir n’est jamais une démarche anodine. Quels que soient le niveau de son patrimoine et sa maîtrise des produits d’investissement, il est toujours important d’être bien accompagné.

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Your retirement planning checklist

With the help of three experts, we’ve compiled a list of ten questions to ask yourself when it comes to retirement planning. And--you’ll see why if you keep reading--no, you’re not too young to start thinking about this!

Have you begun yet?

This isn’t really a question, in the sense that your answer doesn’t matter. Because-unless you’re already retired--it’s never too late to start.

Still, sprung with a question about one particular age, Claudia Halmes-Coumont, director of insurer La Luxembourgeoise-Vie, responds--a bit wryly--“40 is already late.”

“Not too late!” she quickly adds. “But it’s better to start very early.”

People are tempted to put off investing in their retirement because it’s far away. “But,” points out Pierre Blanchet, head of retail investment solutions at Amundi, “the earlier you start investing, the less you’ll have to save.”

It’s also a myth, Blanchet continues, that you have to be rich to invest. “In reality,” he says, “with regular payments, even of small amounts, and thanks to the power of compound interest, it is perfectly possible to achieve your financial goals.”

“When it comes to investing, time is a precious ally,” he says. He’s thinking about the power of compound interest, which is not to be underestimated. “The interest generated by our investments has a snowball effect throughout our lives, and its impact can be considerable Indeed, interest itself generates interest.”

“ In reality, with regular payments, even of small amounts, and thanks to the power of compound interest, it is perfectly possible to achieve your financial goals.”

PIERRE BLANCHET Head of retail investment solutions, Amundi

Imagine you’re 30 years old, says Marc Hengen, managing director of Luxembourg’s professional association of insurers and reinsurers (Aca). Maybe you can afford to put aside €100 a month. And why shouldn’t you? People might not realise, he says, that it’s flexible: “If, three years later, for any reason you can’t save that money anymore, you can always change [your scheme]. You’re not bound by the contract to pay hundreds a month.”

What’s your investment strategy?

You have some options when it comes to insurance products: there are fixed products with guaranteed yields, and there are more variable products (funds) where you can choose the underlying assets.

Blanchet explains that your investment strategy should be informed by how far away your retirement is. Are we talking a decade? Two? Three?

“If you’re investing in the long-term,” says Halmes-Coumont, “it’s very important to invest in the capital markets. The returns are much more interesting.” It amounts to a risk question: the younger you are when you start, the more risk you can take on, so investing in funds is probably better. If there is a crisis, you’ll have time afterwards to recover or change strategies.

Sophie Margue, Matic Zorman (archives) and Amundi

Journalist JEFFREY PALMS

EU STATISTICS

The results of the 2024 Pension Adequacy Report (done by the European Commission and the Social Protection Committee) throws some light on the wider situation.

FROM THE REPORT

Statistically speaking, Luxembourg’s elderly population (65+) have the third-lowest risk, within the EU, of poverty or social exclusion. While no rate above 0% is fundamentally acceptable for this, the grand duchy’s 11.3% is nevertheless well below the European average of 20.2%. Disparities within the ranking are big, from Norway’s 8.2% to Estonia’s 53.1%. Nevertheless, the Chamber of Employees has pointed out that, since the last reforms in 2012, the risk of poverty among pensioners in Luxembourg has doubled.

Across the EU, income inequality among people aged 65+ increased between 2012 and 2022, whereafter it began to fall. In 2022, the richest 20% of EU pensioners was four times wealthier than the poorest 20%. Luxembourg pensioners get their pensions for longer than anybody else in the EU, i.e., for an average of 25.3 years (the differential between sexes being about +2 years for women). At the same time, Luxembourgers have the shortest working lives in the bloc, with an average of 38.5 years. This puts the country squarely on top of the chart with a ratio (working-to-retired life) of 1.52. Our neighbours France (1.72) and Belgium (1.78) are next in line, while Latvia (2.44) is at the bottom. The EU average of 1.97 breaks down to 41.3 years of work and 21 years of retirement.

“

If you’re investing in the long-term, it’s very important to invest in the capital markets. The returns are much more interesting.”

But when you get into your 50s, says the Lalux director, it’s time to adjust your investments so that they’re safer. In other words, start putting more of it into plans with guaranteed yields.

How much do you need?

“It’s essential to define the capital to be built up,” says Blanchet, “which will supplement the pension received from the general scheme. Will you need to supplement your income if your basic pension proves insufficient to maintain your standard of living?”

This implies an exploration of things like your future daily expenses, how much travelling and splurging you’ll want to do, how expensive your hobbies are where you want to retire (and, notably, how expensive

offers a supplementary pension plan. If so, sign yourself up. You can pay into it at a maximum of €1,200 per year (so €100 per month). “It’s a very interesting vehicle,” says the Lalux director, noting that it comes with some good tax breaks.

Such a scheme (which falls under the second pillar of the pension system) is not quite a savings account but rather a special pension pot, where your employer contributes and you can as well . As a bonus, the scheme covers death and disability as well as retirement.

Being part of this kind of scheme is increasingly important, says the Lalux expert, given that the first pillar of the pension system--public contributions--is currently under the chopping block of reforms and is certain to be reduced in the coming years. (If not now, she says, then within the next 15 years.)

No matter your answers to any of the above,es-Coumont, is here: check if your employer

As of late 2024, some 2,200 companies in Luxembourg offered supplementary pension schemes (covering around 70,000 employees). Unfortunately, that means

“ Insurance companies and their intermediaries are specialised in this area and it doesn’t cost anything. If you just get advice, you are not forced to buy anything.”

MARC HENGEN Managing director Aca insurance association

that not everybody has this option. “If not,” says Halmes-Coumont, “you can always ask your employer to install one.”

Self-employed people, have you made your own plan?

If you employ yourself, you’re not left out: instead of a scheme capped at €1,200 per year, you can rig your own plan and pay up to 20% of your annual revenue into it.

Have you thought about tax?

“It’s important to consider the tax implications,” says Blanchet.

“There are some tax measures in place,” agrees Hengen, “if you pay for retirement.” He notes that you can deduct your premiums from your taxable income and that when the benefits get paid out they are not fully taxed as revenue. “So you have advantages at the entrance and at the exit.”

For instance, for the supplementary pension scheme outlined above, you don’t pay any tax on it now--when you’re paying into it--and when you eventually cash out, Halmes-Coumont explains, the only part you’ll pay is a 1.4% dependency contribution.

Do you have a private insurance contract?

This would be the third pillar of the pensions system: if you pay income tax in

Luxembourg, you can take out an insurance contract with a premium of €3,200 per year and which is fully deductible from your taxes. The contract must be for a minimum of one decade and be payable when you’re between 60 and 75 years old. When you cash out, the capital is taxable at half the rate of your average tax percentage.

Are you diversifying your investments?

“The watchword for effective retirement planning is diversification,” says Blanchet. “It’s essential never to forget this fundamental principle: ‘you shouldn’t put all your eggs in one basket.’”

Are you doing everything you can to ensure your financial security?

For retirees, financial security is everything. Blanchet has some extra advice: “You can increase your financial security by owning your principal residence so that you don’t have to pay rent when you retire.” Though don’t forget, he adds, to budget for the upkeep of this property.

It’s also important, he says, to have a proportion of your investments in cash. “This means gradually reducing the risky part of your investments, while keeping another portion in medium-term investments to maintain a satisfactory return.”

Are you going to retire in Luxembourg or elsewhere?

If you’re planning to move away, you will need to cash out of your pension schemes before you go. It’s therefore a good idea, says Halmes-Coumont, to look at the double tax treaty between the two countries (Luxembourg and your destination). This is important because the treaty will determine where you have to pay tax on the three pillars (public, employer, private) of pensions.

“It’s well-regulated with our neighbouring countries,” she adds, “but for other countries you’ll have to look.”

For the rest…

“People think it’s extremely complicated,” says Hengen of investing in your retirement. Sure, there are lots of questions to ask. Maybe it is a little complicated. What if you’re feeling overwhelmed? “Get yourself advised,” he says, plainly. “Insurance companies and their intermediaries are specialised in this area and it doesn’t cost anything. If you just get advice, you are not forced to buy anything.”

PREMIUM

Considering a health mutual

Health mutuals are complementary to modern social security systems, and locking in this type of supplemental coverage early can be a smart investment. Fabio Secci, CEO of Caisse médico-complémentaire mutualiste (CMCM), explains more.

Journalist NATALIE A. GERHARDSTEIN

Not an insurance company

The CMCM, created in 1956, is a non-profit association, operating on a non-commercial basis. “Apart from paying salaries and taxes, our main aim is to reinvest as much as members pay in,” Secci explains. No medical examination is required to become a member, and there aren’t any age restrictions for joining. One membership covers an entire immediate family (the largest the CMCM has had to date covered 11 people in total). The CMCM does not cover death and focuses solely on health coverage.

Three coverage levels

The CMCM offers three levels of supplementary coverage, each one a prerequisite for the next, all of which include 24/7 assistance abroad, including worldwide repatriation and travel cancellation. The most basic is the “Régime Commun”, which includes benefits for hospitalisation, pre- and post-operative physiotherapy, including certain aspects like home care. A premium option, “Prestaplus”, includes reimbursement of first-class hospitalisation and ambulance transportation costs, plus osteopathy/chiropractic treatments, as well as certain preventative medical treatment. “Denta & Optiplus”, as the name implies, covers a range of dental and optical services, from dental crowns and implants to refractive eye surgery.

Changing trends

Over the decade Secci has served as CEO, he says the average age of subscribers has dropped from around 60 to the early 50s. He acknowledges that younger people might not have the reflex to join, when hard-earned euros need to provide for a range of other expenses, but the CMCM has been actively campaigning to encourage them to join, even offering a 10% discount to unmarried individuals under 30.

Locking it in

While annual membership rates vary depending on age, starting at just under €285.92, they’re locked in for a lifetime (with increases only linked to indexation)--yet another reason to consider joining early.

Ensuring the “mutual” aspect

For new joiners, there’s a three-month grace period to get benefits. Secci says it’s not unheard of for people to join, take advantage of benefits for a year or two, and then opt out, although it’s not recommended. For those who later want to rejoin, however, there’s a more severe grace period, serving as a sort of disincentive to that short-term strategy.

A real investment

As Secci notes, mutual health coverage can be seen as an investment due to its comprehensiveness and affordability. “It covers you most when you need it most,” he adds. “If you are severely ill, or something like an accident happens to you, even abroad, your life changes anyway… whatever illness you might get, a mutual will never kick you out.”

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Les cinq erreurs à ne pas commettre

La fiscalité liée à l’investissement peut affecter, de manière plus ou moins importante, les rendements escomptés. Mieux vaut prévenir que guérir.

Auteur SÉBASTIEN LAMBOTTE

1Confondre dividendes et plus-values

Si l’on investit, c’est dans l’optique de faire fructifier ses avoirs. La rémunération des investissements s’effectue de diverses manières. En l’occurrence, il convient de distinguer les intérêts ou dividendes versés des plus-values réalisées. Pourquoi est-ce important ?

« Le traitement fiscal de l’un et de l’autre n’est pas équivalent, explique un associé au sein du cabinet Atoz, Antoine Dupuis. Au Luxembourg, les plus-values réalisées sur des investissements dans des titres financiers détenus pendant plus de six mois sont exonérées d’impôt, à condition que l’on ne détienne pas plus de 10 % des titres financiers liés à l’actif en question. En revanche, les dividendes et intérêts perçus sont soumis à un impôt selon un taux progressif (au demi-taux global dans le cas de certains dividendes). Dans la mesure où ces éléments affectent le profil de rendement associé à un investissement, il est donc crucial de prendre en compte ces aspects fiscaux avant d’investir. »

2Ne pas tenir compte de la double imposition

Si les dividendes sont soumis à la fiscalité luxembourgeoise, ils peuvent également faire l’objet d’une retenue à la source dans le pays où se situe l’actif dans lequel on investit. Par exemple, un dividende versé par une société américaine à ses actionnaires est taxé aux États-Unis, quel que soit le lieu de résidence du détenteur des titres. Ce dividende peut aussi être imposé dans le pays de l’investisseur.

« Fiscalement, cela peut peser lourdement sur les rendements espérés, commente Antoine Dupuis. Afin d’éviter ce problème, le Luxembourg a établi des conventions avec 90 juridictions étrangères. Lorsque les revenus sont soumis à des impôts dans une juridiction étrangère avec laquelle il existe une convention, un crédit d’impôt peut être accordé au Luxembourg afin de réduire cette double imposition. Mais c’est à l’administré d’en apporter la preuve, et le calcul entre la partie imputable et déductible de l’impôt étranger peut être compliqué. »

3

Actifs privés : négliger la structuration

Si, dans une optique de diversification, vous décidez d’investir dans des actifs privés, comme l’immobilier ou le private equity, il est essentiel d’être vigilant quant à la manière dont vous structurez votre démarche.« Le choix du véhicule est important, assure Antoine Dupuis. Selon la structure juridique mise en place, on peut éviter à l’investisseur de s’exposer à des implications fiscales liées aux sociétés dans lesquelles le fonds investit ou aux juridictions dans lesquelles il est actif. Selon la stratégie du fonds, la chaîne d’investissement envisagée et les zones géographiques dans lesquelles il opère, il convient de mettre en place la structure la plus appropriée. »

« Les intérêts générés par des activités de minage ou de staking sont eux aussi imposables et peuvent même, dans certains cas, être considérées comme une activité commerciale. »

4Ne pas contrôler les informations du fonds Lorsque l’on investit, il est aussi primordial de s’assurer que les informations que le gestionnaire de fonds est susceptible de partager avec l’administration fiscale sont correctes. À défaut, on peut s’exposer à de mauvaises surprises. « Chaque année, un véhicule luxembourgeois considéré comme fiscalement transparent dans lequel un investisseur a des intérêts doit établir une déclaration. Certaines informations déclarées, comme les revenus alloués aux investisseurs, servent de base à la taxation de ces derniers, commente Antoine Dupuis. Cependant, il arrive que ces informations soient incorrectes et que, lorsque l’investisseur s’en rend compte, le délai de recours pour les faire modifier soit dépassé. Il n’est alors plus possible d’intervenir. C’est pourquoi il est essentiel de demander à recevoir les informations fiscales du véhicule d’investissement dès qu’elles sont disponibles, afin de pouvoir les contrôler. »

Considérer que la crypto n’est pas taxable On parle beaucoup des actifs crypto. Il est aujourd’hui facile d’acheter des jetons (bitcoins, ethers ou encore NFT) sur de nombreuses plateformes. De plus, ces jetons peuvent être convertis très facilement. « Le cours de ces actifs est très volatil. À la suite d’une hausse soudaine du bitcoin, on peut être tenté de réinvestir rapidement les bénéfices réalisés dans d’autres jetons, explique Antoine Dupuis. Il ne faut cependant pas oublier que l’investissement dans ces actifs est soumis aux mêmes règles fiscales que n’importe quel autre. Si l’actif n’a pas été détenu plus de six mois, la plus-value réalisée sur la cryptomonnaie ne peut dès lors pas bénéficier d’une exonération d’impôt. Les intérêts générés par des activités de minage ou de staking sont eux aussi imposables et peuvent même, dans certains cas, être considérées comme une activité commerciale. » Si l’administration venait à s’intéresser de plus près à ces activités, l’investisseur pourrait être amené à rendre des comptes. Boîte à outils

ANTOINE DUPUIS Associé Atoz

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100% Social Media

À la recherche du Graal

Les applications se multiplient depuis des années, qu’elles s’intéressent à des pans particuliers de l’investissement « amateur » ou professionnel. Trois exemples, centrés sur le responsable, sur l’IA ou sur des méthodes alternatives.

MONIFLO

Fondée par Georges Bock

Application d’investissement axée sur les valeurs, permettant aux utilisateurs d’investir de manière durable et simple, Moniflo offre la possibilité de filtrer les fonds selon des critères financiers, de durabilité, d’impact social ou de valeurs personnelles, alignés avec les 16 objectifs de développement durable (ODD) de l’Onu. Lancée en février 2024, Moniflo propose plus de 200 fonds Ucits durables. Fondée par Georges Bock, ancien associé chez KPMG Luxembourg, l’application est développée par la société luxembourgeoise Investre. Moniflo est disponible en plusieurs langues, dont le luxembourgeois, le français, l’anglais et l’allemand, reflétant son engagement envers l’inclusion financière. En janvier 2024, l’entreprise a levé trois millions d’euros pour accélérer son développement et son expansion européenne, notamment en Allemagne.

ORISKANY

CEO et cofondateur Cyril Alvarez-Pereyre

Oriskany est une fintech franco-luxembourgeoise spécialisée dans la création de stratégies d’investissement quantitatives. Elle utilise des ensembles de données non linéaires et l’ingénierie financière pour développer des investissements robustes, liquides et sur mesure. Contrairement aux approches traditionnelles basées sur la théorie moderne du portefeuille – moderne, mais de 1952 –, Oriskany intègre les comportements imprévisibles des marchés financiers dans ses modèles. Selon Cyril AlvarezPereyre, CEO et cofondateur, et Hervé Kias, head of advisory & CFO d’Oriskany, cette approche permet de mieux anticiper les périodes d’incertitude et d’adapter les stratégies en conséquence, offrant ainsi des solutions d’investissement plus résilientes et stables pour leurs clients.

VINGEGPT

Développée par Candi Carrera

VingeGPT est une application alimentée par l’IA, conçue pour assister les investisseurs dans l’analyse financière et l’évaluation des entreprises. Les utilisateurs peuvent accéder à des métriques détaillées, évaluer des rapports financiers et explorer les principes de l’investissement axé sur la valeur. Que ce soit pour analyser la position sur le marché, calculer la valeur intrinsèque ou identifier des opportunités d’investissement avec un avantage concurrentiel, VingeGPT fournit les connaissances nécessaires pour prendre des décisions éclairées. Développée par Candi Carrera et ses associés réunis dans 36 Square, VingeGPT est disponible exclusivement sur la boutique OpenAI et propose également une formation complète sur son utilisation via un cours sur Udemy. Une communauté active d’utilisateurs est accessible via un canal Discord dédié.

Photos Romain Gamba (archives), Guy Wolff (archives) et Oriskany

Journaliste THIERRY LABRO