Vantage: Investing in future trends with Heptagon’s Alex Gunz

Alex Gunz is the manager of the Heptagon Future Trends Equity Fund, which aims to differentiate itself from the MSCI World Index and other growth funds by offering concentrated, genuine pan-thematic exposure to emerging future trends, investing, as Alex says, in everything from ‘fish to chips and cloud to wind’. We examine how Alex understands emerging trends, using AI as an example. It’s an area that he started looking at many years ago, with his thesis updated several times since Heptagon’s first work on the topic in 2016. Alex’s investment approach marries a top-down view of any given theme with a bottom-up assessment of companies that might benefit commercially from the themes. Finding businesses that meet the fund’s stringent investment criteria is often the hardest part of the process, hence Alex is drawn to second-order beneficiaries of trends, the metaphorical shovel makers rather than the miners. Alex illustrates this approach with two of his holdings. He recently invested in GXO Logistics (GXO.N, market capitalisation $7bn), which is a play on the broader theme of online society. GXO is the number one operator for contract logistics and its expertise is prompting more and more retailers to outsource this element of their business to a dedicated specialist.

Alex wrote about his recent visit to some of GXO’s UK sites in his recent blog post, My trip to the Golden Triangle. The other company Alex highlights is Xylem (XYL.N, market capitalisation $26bn), a leading player in water technology, which helps manage the supply-side challenges associated with meeting rising water demand. Finally, we talk about Alex’s food blog, where he highlights three recent top experiences: Abeno, for something close to Edison’s offices, Saltie Girl in Mayfair and Core in Notting Hill, for special occasions.