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How does the Kempen Global Small-cap team look back on 2017?

1. Star status
We were awarded a five-star rating by Morningstar. This is a recognition for the strong track record we have built up over the past few years. Only the ten percent best-performing funds in each investment category receive this five-star rating.

2. Double digits

Another year of a double-digit return for our clients. We succeeded in earning a net return in excess of ten percent for the third year in a row. Moreover, the return of the past three years after fees was higher than that of our index each year. On average the fund outperformed the benchmark MSCI Smallcap World TR (net dividends) index) by five percent per annum over the last three years.

The value of your investment may fluctuate. Past performance provides no guarantee for the future.

3. Robust recovery

First Solar, the only stock with a significant negative contribution to the return in 2016, underwent a robust recovery in 2017 and was the stock that added most to the portfolio’s return in 2017.
4. Engaged shareholdership
We believe in long-term value creation and give substance to this by conducting active dialogue with the management teams of the companies in which we invest. This dialogue encompasses the strategic direction of the companies, capital allocation decisions and ESG (environmental, social, governance) policies. The commercial traction of the fund (the size increased more than fivefold in 2017, to over 300 million euros) has been of assistance here. After all, our holdings in companies increase proportionally in line with the size of the fund.
5. The unexpected
By definition, not everything will go smoothly in a portfolio containing some seventy stocks. The largest negative contribution to the return last year came from Norway’s Opera Software, which had to adjust its forecasts downwards on a couple of occasions. In 2017, we twice travelled to Oslo to talk to the management team and the CFO also visited us in Amsterdam in the summer. In spite of Opera’s worse than expected year, we continue to be confident about our investment case.

Looking back over the year, we are grateful for the confidence placed in us by our clients and look forward to the 2018 investment year.

This document is prepared by the fund managers of Kempen (Lux) Global Small-cap Fund (‘the Fund’),managed by Kempen Capital Management N.V. ("Kempen‘’). The views expressed in this document may be subject to change at any given time, without prior notice. Kempen has no obligation to update the contents of this document. As asset manager Kempen may have investments, generally for the benefit of third parties, in financial instruments mentioned in this document and it may at any time decide to executebuy or sell transactions in these financial instruments. The information in this document is solely for your information. This document is for information purposes only and provides insufficient information for an investment decision. This document does not contain investment advice, no investment recommendation, no research, or an invitation to buy or sell any financial instruments, and should not be interpreted as such. This document is based on information that we consider reliable, but we do not represent that it is accurate or complete, and it should not be relied on as such. The views expressed herein are our current views as of the date appearing on this document. This document has been produced independently of the company and the views contained herein are entirely those of Kempen.



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