Kaiser Partner Ptivatbank - Monthly Market Monitor March 2021

Monthly Market Monitor

March 2021

Table of contents Satellite View Geopolitical heat map

In a Nutshell

Our view on the markets

07

04 Macro Radar

Theme in Focus Interest-bearing alternatives

Taking the pulse of

Asset Allocation Notes from the Investment Committee

08

economic activity

The Back Page

10

06

Asset classes & agenda

ESG - Sustainability Corner How much is water worth to us?

12

11

Kaiser Partner Privatbank AG | Monthly Market Monitor - March 2021

3

In a Nutshell

Our view on the markets

Biden ups the ante US Democrats used their razor-thin majority in the Senate to pass another coronavirus relief package. The total stimulus for a post-pandemic economic recovery in the USA thus now amounts to USD 5 trillion, or 24% of the country’s annual GDP. In light of the fiscal activism, some soothsayers already see growing risks of an overheating US economy gathering on the horizon.

Sector rotation on the equity markets An unusually rapid increase in bond yields has roiled the financial markets in recent weeks. Equity investors sold their longstanding favorites (in the technology sector) and bet on new ones in cyclical industries sensitive to changes in economic activity. This sector rotation should no more than slow the intact uptrend on the equity markets, but is unlikely to end it.

Italy launches a green bond issue Whoever is invested in bonds has suffered price drawdowns in recent weeks as a result of rising market interest rates. But not every investor can simply bypass this asset class. Whoever is compelled to invest in bonds due to his or her risk profile or existing restrictions at least has more and more ways to do it sustainably. Italy has now also joined the market for green bonds. Its maiden green bond issue was nine times oversubscribed.

Chart of the month Global rise in market interest rates | Already a threat to the markets ?

Yield on 10-year government bonds 2%

1%

0

USA

Switzerland

Germany

United Kingdom

01/2021

10/2020

07/2020

04/2020

01/2020

-1%

Australia

Sources: Bloomberg, Kaiser Partner Privatbank 4

Monthly Market Monitor - March 2021 | Kaiser Partner Privatbank AG

Outlook for a 50/50 portfolio A simple, balanced portfolio consisting of stocks and a blend of government and corporate bonds will prospectively generate an average annual return of +3.3% over the next five years, which is only around half as high as the annual return seen over the last several decades. Whoever would like to continue earning good risk-adjusted returns in the future must add interestbearing alternatives to the asset allocation. A portfolio optimized in this way makes it possible to continue earning an average annual return above +5% for the next five years while maintaining a similar risk profile.

World Water Day World Water Day on March 22 will focus attention this year on asking what the value of water is, a question that couldn’t be more complex. Available in abundance in some places but in scarce supply in ever more regions of the world, “blue gold” is a vital resource whose importance is continually increasing. Water is also more topical than ever as an investment theme.

Yields on long-term government bonds have increased significantly since the start of 2021. This means that the financial markets are pricing in an expected economic recovery this year and rising inflation expectations. One might think that central banks should welcome this development since a 2% inflation rate (higher than the ones recorded in recent months) and higher economic growth are core objectives of their monetary policies.

But an overly rapid increase in market interest-rate levels is also undesirable. Several European Central Bank spokespersons have thus already called for new monetary policy actions in the event that market interest rates climb higher. The Reserve Bank of Australia already responded at the start of March by doubling its daily bond purchases. Central bankers appear to be going ever further down a blind alley that will be hard to maneuver their way out of.

Kaiser Partner Privatbank AG | Monthly Market Monitor - March 2021

5

Macro Radar

Taking the pulse of economic activity

The slogan “Make America Great Again” evidently also goes for US President Joe Biden and the Democratic Party. The third coronavirus stimulus package just passed will once again shift US economic activity into a higher gear. Europe risks being left behind.

Gimme my stimmy!

US Democrats continue to plow full steam ahead. With only a few concessions (e.g. on a minimum-wage hike), they succeeded in passing a third coronavirus relief package to the tune of USD 1.9 trillion. This relief deal once again includes checks for the public (USD 1,400 per eligible person) aimed at stimulating consumer spending. The new round of stimulus comes at a time when the US economy quite evidently is already back on a growth path, as evidenced not least by the upbeat February labor market report. More than a few forecasters already see risks of overheating on the horizon as a result of the perpetual stimulus.

Europe lagging behind While economic output in the USA may already return to the pre-crisis level by as soon as mid-year, this is un-

Back to “normal” conditions | Steeper yield curve signals economic upturn US yield curve (spread between 10-year and 2-year US Treasury yields)

2%

1%

0

2020

2016

2012

2008

2004

-1% 2000

Fed unconcerned, ECB apprehensive Central bankers’ reactions to the sharp increase in market interest rates in recent weeks were attuned to the current respective growth outlooks. Whereas Federal Reserve Chairman Jerome Powell interpreted the upmove as an encouraging economic signal and emphasized that there was no reason to shift away from the current monetary policy, several governing council members at the European Central Bank already felt compelled to intervene verbally. Then at the March policy meeting, ECB President Christine Lagarde officially stated that the central bank intended to contain further rises in market interest rates.

Temporary upsurge in inflation After China refrained from setting an official economic growth goal during the year of the pandemic, Prime Minister Li Keqiang issued a target at this year’s session of the National People’s Congress. He cited a growth figure of +6%, which quite evidently is just a gap filler since the consensus forecast among analysts is already projecting more than +8% for 2021. COVID-19 stimulus is to be scaled back this year, and the focus is to be placed more on paying down (government) debt. Meanwhile, domestic consumption is to be boosted further to reduce China’s dependence on foreign demand.

3%

Sources: International Monetary Fund (IMF), Kaiser Partner Privatbank

Consensus estimates

Kaiser Partner Privatbank interest rates view 2020

2021

2022

GDP growth (in %)

Last

3M

12M

Key interest rates (in %)

Switzerland

-3.2

3.2

2.8

Switzerland

-0.75

→

→

Eurozone

-6.8

4.2

4.1

Eurozone

-0.50

→

→

UK

-10.0

4.6

5.5

UK

0.10

→

→

US

-3.5

5.5

3.8

US

0.25

→

→

2.3

8.4

5.5

China

2.95

→

→

China Inflation (in %) Switzerland

10-year yields (in %) -0.7

0.2

0.4

Switzerland

-0.27

→

→

Eurozone

0.3

1.4

1.2

Eurozone

-0.32

→

→

UK

0.9

1.5

1.9

UK

0.71

→

→

US

1.3

2.3

2.2

US

1.53

→

→

China

2.5

1.5

2.3

China

3.25

→

→

Sources: Bloomberg, Kaiser Partner Privatbank 6

likely to happen in the Eurozone until a year later at the earliest. After its gross domestic product contracted twice as much as on the other side of the Atlantic last year, at the start of this year the old continent is facing a virus-induced double-dip recession. However, as the weather warms, an economic upturn is bound to gain momentum in Europe by the end of spring.

Monthly Market Monitor - March 2021 | Kaiser Partner Privatbank AG

Sources: Kaiser Partner Privatbank

Satellite View Geopolitical heat map

Italy’s new government has averted the threat from USA vs. China US President Joe Biden reiterated the USA’s hard-line the left and the right in that country as well for now. stance toward China during his first phone call with Chi- In France, however, President Emmanuel Macron’s apnese President and Communist Party General Secretary proval rating is languishing at a low level while rightXi Jinping. He expressed “fundamental concerns about wing populist Marine Le Pen is making a comeback, a Beijing’s coercive and unfair economic practices and its development that we will continue to monitor. increasingly assertive [military] actions in the region.”

China, in the meantime, has increased its 2021 defense What comes after Merkel? budget by a bigger-than-expected 6.8%. We view a con- The era of German Chancellor Angela Merkel will detinue cold war between the two economic powers and finitively end in autumn after almost 16 years. Durthe saber-rattling in the South China Sea as one of the ing her chancellorship, Germany went from being the “sick man of Europe” to becoming the continent’s biggest geopolitical risks in the years ahead. economic growth engine and an anchor of stability for the European Union. Germany’s Christian DemocratPopulism in Europe The risk posed by populist parties in Europe in recent ic Union (CDU) sent an initial signal of continuity by years tended to be overrated. The coronavirus crisis electing Armin Laschet to be its new party chairman. whipped up a massive headwind for them in many If Laschet becomes Germany’s next chancellor, he countries – like it did for the AfD in Germany, for ex- will likely adhere to and continue with Merkel’s cauample – and put a tailwind behind traditional establish- tious pro-Europeanism and her policy of compromise ment parties. Former European Central Bank President and conciliation within the EU between the wealthier Mario Draghi’s move to integrate all major parties into north and the poorer south.

Geopolitical developments do not stop at the gates of the financial markets.

On the contrary, they have become an increasingly important influencing variable in recent years. Our Satellite View takes a look at the major hotspots at the moment.

Kaiser Partner Privatbank AG | Monthly Market Monitor - March 2021

7

Asset Allocation

Notes from the Investment Committee

An unusually rapid increase in bond yields has stirred up the financial markets in recent weeks.

Equity investors sold their longstanding favorites and bet on new ones. But a portfolio that is well diversified across sectors, investment styles and asset classes can rest easy about a potential regime change.

Asset allocation monitor -

+

-

Cash

Equities

Fixed Income

Global

Sovereign bonds

Switzerland

Corporate bonds

Europe

Microfinance

UK

Inflation-linked bonds

US

High-yield bonds

Emerging Markets

Emerging markets bonds

Alternative assets

Insurance-linked bonds

Commodities

Convertible bonds

Gold

Duration

Real estate

Currencies

Hedge funds

US dollar

Structured products

Swiss franc

Private equity

+

Euro British pound

Equities: The rotation continues Scorecard • Two steps forward and one step back – equity mar+ kets around the world have edged upward on bal- Macro ance since the start of this year. Beneath the surface, Monetary/fiscal policy though, there have been sizable share-price swings. Earnings The USA’s Nasdaq technology index, for instance, Valuation has intermittently corrected by around 10% since Trend hitting an all-time high in mid-February. Meanwhile, Sentiment classical cyclical sectors such as financials and energy, which benefit from rising interest rates and/or an impending pickup in economic activity, have been back in vogue lately and are up 15% or even more Fixed income: Taper Tantrum 2.0? than 30%, respectively, year to date. Rising govern- • Bond investors this year have learned the hard way ment bond yields are bound to put only a tempothat fixed-income securities aren’t always a safe rary brake on the overall market, but are unlikely to asset class with low volatility, especially not when spark a long-term trend reversal. yields are at rock-bottom levels and can hardly fall • The upward trend in stock prices remains well unany farther. The yield on 10-year US Treasury notes derpinned by the fundamentals, in our view. The has climbed from 0.9% to 1.6% since the start of reporting season for the fourth quarter of 2020 this year. Whoever was invested in those sovereign brought many upside surprises in the final analysis. debt securities suffered a price drawdown of around European companies also beat analysts’ estimates 6%. The popular iShares 20+ Year Treasury Bond ETF, this time (unusually frequently) even though earnwhich tracks a basket of long-dated US government ings contracted year-on-year. We now expect to bonds, has shed a whopping 15% or so of its value see a return to robust earnings growth and solid over the same period. The picture has been shaped net profit results for 2021. Central banks look set by high volatility and low liquidity, bringing to mind to keep the monetary floodgates wide open. But comparisons with the famous “taper tantrum” in we are still unlikely to see a one-way street in the 2013, the last time the US bond market was roiled. months ahead because whenever near-term invesUS Federal Reserve Chairman Jerome Powell extor sentiment overheats, intermittent corrections pressed little concern in early March about the turcan be expected. bulence observed and instead hailed the rise in mar8

Monthly Market Monitor - March 2021 | Kaiser Partner Privatbank AG

raising the opportunity cost of holding bullion. After ket interest rates as an encouraging economic signal. correcting by around 20% since August of last year, We, in the meantime, feel vindicated in our view the price of gold is now approaching an interesting that bonds still have a place in investment portfolios, level from a tactical perspective. If it drops farther, but that it should be a smaller one than in the past the precious metal is likely to encounter buying inin favor of more attractive fixed-income alternatives. terest by investors seeking inflation protection and • Investors haven’t gotten anywhere with European a diversifying element for their portfolios. bonds either lately. But not every investor can simply give this asset class a wide berth. If you do have to invest in bonds, though, then go green, the motto Currencies: The EUR/CHF cross comes to life might read. Such an investment can now also be • EUR/USD: The omens on the interest-rate markets are currently favoring the US dollar. In light of the made in Italian green government bonds since early combination of rising inflation expectations and rosy March of this year. Italy’s 14-year green bond offer(near-term) growth prospects due to the US federal ing was nine times oversubscribed and was issued at government’s perpetual stimulus, market particia yield of 1.547%. The “green” premium over “norpants see an increasing possibility of the Fed exitmal” Italian government bonds amounted to around ing its ultra-accommodative monetary policy (a bit) 12 basis points at the start of trading. sooner than previously thought. The consensus view that was emphatically projecting a weaker greenback Alternative assets: Crude oil wins, gold loses at the start of the year and the attendant big bets on • Oil-producing countries appear to have learned from a stronger euro could prove wrong. previous strategy mistakes. In the wake of Saudi Arabia’s surprise production cutback in January, the out- • GBP/USD: The British pound held up relatively well again over the past month. The UK looks set to rank put level was left unchanged at the OPEC+ meeting among the economic growth frontrunners this year, in early March. The consensus forecast, however, and “vaccine momentum” continues to favor the Brithad projected a substantial increase. The producish at the moment. However, the pound’s longstandtion discipline has paid off so far: the price of oil has ing undervaluation is unlikely to sustainably diminish risen by a third since the start of this year and is back further until the currency becomes interesting again at its pre-coronavirus level. Since surplus oil stocks to foreign capital, be it due to higher interest rates or have already been reduced by more than half and the UK’s allure as an investment destination. given the impending pickup in economic activity, the oil market looks destined to find a new equilibrium • EUR/CHF: The EUR/CHF exchange rate has been unusually volatile in recent weeks. The Swiss franc has sooner or later at a somewhat higher price level. depreciated by more than 3% since late February in • The price of gold, in contrast, continued to slide the absence of any distinct triggers. From a technical downward over the past month, intermittently dipanalysis perspective, the EUR/CHF cross has decisiveping below the USD 1,700-per-ounce mark. The yelly and dynamically breached the previous resistance low metal has thus given back all of its price gains at the CHF 1.09 level. Even though there is little pointaccumulated in the second half of 2020. The recent ing to sustained CHF weakness from a fundamental price weakness owes in particular to real interest standpoint, one has to take note of the near-term rates, which have risen in the USA, for example, by price momentum.

0.5 percentage points since the start of February,

Chart in the Spotlight Stock rotation | Investors are betting on new carthorses Russell 1000 Growth index relative to Russell 2000 Value index 120

100

80

60

40

20

2020

2016

2012

2008

2004

2000

0

Fashions come and go, also on the financial markets.

On the US equity market, longstanding investor favorites like Amazon and Facebook have evidently lost popularity in recent months. Their share prices at least have underperformed the broad market. Investors’ new favorites of late include cyclical-sector companies with much smaller market capitalizations. The drivers behind this style rotation are – once again – the upward trend in market interest rates and hopes of a postpandemic boom in economic activity. Although we are of the opinion that technology companies will remain the growth leaders in the future, we acknowledge the catch-up potential that long-neglected value and cyclical stocks possess. A balanced mix of different investment styles seems appropriate to us at the moment.

Sources: Bloomberg, Kaiser Partner Privatbank Kaiser Partner Privatbank AG | Monthly Market Monitor - March 2021

9

Theme in Focus

Interest-bearing alternatives

Regularly reviewing one’s strategic asset allocation is a recurring compulsory exercise for long-term investors. This essentially routine task is actually quite a challenging one at the moment, particularly with regard to the interest-bearing part of the asset allocation.

Whoever would like to put his or her portfolio on a solid footing must be open to (small) innovations in any case.

The good easy years are over Long-term investors (and asset managers) are faced with an important question these days: How should an investment portfolio be strategically positioned, or how should capital be allocated to the various asset classes, to continue generating an attractive risk-adjusted return over the next five to ten years? Such a review of the strategic asset allocation should be conducted regularly, ideally every two to three years. In the best of times, when all asset classes are inexpensively valued and expectable returns are high, this task is an easy, routine exercise. But this isn’t the case in 2021 because at the start of the 2020s decade, almost every (traditional) asset category is richly to exorbitantly valued and yields on safe interest-bearing securities are ultralow (to negative) due to years of ongoing innovativeness on the part of central banks. Whoever would like to make his or her portfolio fit for the future today faces a considerable challenge. He or she has to be prepared to think outside the box and must be open to (small) innovations.

Has a balanced portfolio outlived its usefulness?

A balanced portfolio composed of 50% stocks and 50% bonds has consistently served well in recent decades.

US stocks, for example, have delivered a double-digit annual return contribution averaging +11.2% since 1983 (European stocks have returned a respectable +8.5%) while bonds have also provided not just solid returns (USA: +7.1%; Europe: +7.4%), but have also acted as insurance and have generally cushioned stock price

A safe bank | One could rely on a 50/50 portfolio in recent decades Annual return on a balanced portfolio (50% US stocks, 50% US bonds 30%

drawdowns. Consequently, the average annual absolute return on a 50/50 portfolio was very high at +9.1% for US stocks and bonds (+7.9% for European stocks and bonds), and the inverse correlation between stocks and bonds (particularly during periods of crisis) additionally made the risk-adjusted return attractive. Investors with a balanced portfolio ended the year in the red in only five of the last 40 years. But that’s looking in the rear-view mirror. According to our calculations, over the next five years, a simple, balanced portfolio consisting of stocks and a blend of government and corporate bonds will generate an average annual return only around half as high (+3.3%) as the one recorded over the last 40 years.

Interest-bearing alternatives are called for So, whoever would like to continue earning good riskadjusted returns in the future has to get a bit more creative, particularly when configuring the fixed-income part of an investment portfolio. The demands on this safe portfolio component remain the same as before: it should earn a solid minimum return, and its correlation to stocks should be relatively low so that the overall portfolio stays stable during periods of crisis. Inflationprotected bonds, insurance-linked bonds (catastrophe or “cat” bonds) and microfinance bonds are asset classes that particularly meet the above requirements, in our view. Adding these interest-bearing alternatives to conventional government and corporate bonds and high-yield and emerging-market bonds and combining this fixed-income component with stocks to build a balanced portfolio allows you to continue generating an attractive return in the future. The average annual expected return for such an optimized (and diversified) investment portfolio stands at +4.7% for the next five years, by our calculations, while even entailing a bit less risk (volatility) compared to a 50/50 portfolio.

20%

10%

0

-10%

Sources: International Monetary Fund (IMF), Kaiser Partner Privatbank 10

Monthly Market Monitor - March 2021 | Kaiser Partner Privatbank AG

2020

2015

2010

2005

2000

1995

1990

1985

1980

-20%

Bear one thing in mind, however: there is no free lunch.

If you integrate interest-bearing alternatives into your portfolio, you get similarly good diversification properties and a better return than with conventional bonds, but the liquidity properties are not as good. But since a balanced portfolio typically has a three- to five-year investment horizon, this “liquidity premium” is acceptable. Investors generally should move away from the idea of maintaining daily liquidity for their long-term fixed-income investments or should at least be aware of the opportunity costs of doing so.

ESG- Sustainability Corner How much is water worth to us?

An essential theme Consumers in northern and central Europe and North America could easily forget that water is a scarce resource. After all, in our latitudes, crystal-clear water flows from our faucets reliably every morning. But that’s not the case everywhere in the world. According to data from the World Health Organization (WHO), 2.2 billion people around the globe do not have access to safe drinking water, and a startling 4.5 billion lack access to sanitary facilities. The World Bank estimates that poor sanitation, contaminated water supplies and inadequate hygiene practices cause 675,000 deaths each year and annual economic losses of up to 7% of GDP in the countries worst affected.

The price question These statistics show quite strikingly that (clean) water is precious and has a value. But how high is the value of water? This is precisely the subject being addressed by this year’s World Water Day, which since 1993 is celebrated annually on March 22. The question about how much water is worth is a multidimensional one. Besides the nutritional and health aspect of water, the question is also about water’s value as a factor of production in agriculture and industry and also concerns the (often underestimated) value of water infrastructure (storage, treatment and distribution). World Water Day also aims to deepen people’s appreciation of the natural hydrological cycle, which is perhaps the most important service provided by our ecosystem, and to encourage corresponding steps to protect our environment. And, finally, World Water Day also seeks to ascribe value to the sociocultural aspect of water as a source of recreation and spirituality and as an intrinsic part of every culture the world over. The question of what the fair (economic) value of water is has no easy reply, in part because there’s no universal answer. Since water is becoming increasingly scarce, it by all rights ought to be getting more expensive. But the price of water actually seldom corresponds to its true value due to complex pricing regimes and inefficient markets. Water is a special commodity. At its sources where it originates, water has the nature of a public good that requires strict (environmental protection) regulation to preserve those sources. Canal, pipeline and treatment systems turn water into a private good. The water business therefore cannot be left to the free market alone – the right regulatory framework is needed. A market for trading water rights has taken root in recent decades in Australia, but

political scandals involving overpriced water licenses and headlines about profit-greedy institutional investors have exposed the risks of putting a price tag on this scarce resource. A water-rights market also came into existence in California some time ago, and futures contracts on California water prices can now also be traded on the Chicago Mercantile Exchange since December of last year. However, the results after the first few weeks of trading have been disillusioning: few transactions have taken place thus far and daily trading volume has been accordingly low.

The blue trend presents investment opportunities But seeing the big picture of water should be more important than knowing its (local) market prices, and that goes for investors as well. Alongside the aspects described above that give water a value from different perspectives, investing in water security and supply likewise presents a sustainably valuable investment opportunity. One popular (and well diversified) way to invest in water is through thematic funds specialized in water-related assets. They give investors an opportunity to invest in companies that provide technologies, products or services relating to the water value chain, enabling them to gain exposure to a market that promises a great deal of innovation and growth.

World Water Day on March 22 will focus attention this year on the value of water.

Asking how much water is worth poses a question that couldn’t be more complex.

Available in abundance in some places but in scarce supply in ever more regions of the world, “blue gold” is a vital resource whose importance is continually increasing. Water is also more topical than ever as an investment theme.

Water is growing scarce | Business as usual is becoming problematic Water stress in 2040 based on estimated ratio of withdrawals to supply

Wasser-Stress Level 0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

Sources: World Resources Institute, Kaiser Partner Privatbank

Kaiser Partner Privatbank AG | Monthly Market Monitor - March 2021

11

The Back Page Asset classes & agenda

Performance as of 28 February 2021 Asset class

year-to-date

Cash

1 month

1 year

3 years

0

Cash CHF

-0.1%

-0.1%

-0.6%

-2.0%

Cash EUR

-0.1%

0.0%

-0.4%

-1.2%

0.0%

0.4%

5.2%

Cash USD

0.0%

Fixed Income

0

Sovereign bonds

-2.5%

-1.8%

-1.1%

9.1%

Corporate bonds

-2.6%

-1.6%

5.4%

17.0%

Microfinance

0.7%

Inflation-linked bonds

-3.4%

High-yield bonds

0.3%

Emerging markets bonds

-4.3%

Insurance-linked bonds

0.0%

Convertible bonds Equities

0

4.3%

Global

1.9%

Switzerland

-2.0%

Europe

2.2%

UK

1.0.%

USA

1.6%

Emerging markets

3.7%

Alternative assets

9.3% -8.7%

Real estate Switzerland

-2.0%

Hedge funds

1.3%

Currencies EUR/USD

1.5%

GBP/USD

10.3% 16.9% 19.1%

0.1%

7.1%

-2.9%

0.7%

14.1%

-0.3%

4.0%

11.9%

1.9%

45.9%

59.2% 36.2%

2.6%

26.1%

-0.6%

7.7%

26.1%

3.6%

11.8%

11.6%

1.8%

-0.2%

-1.8%

2.6%

33.4%

49.8%

0.7%

33.2%

12.1%

6.5%

20.1%

-3.2%

-6.1%

9.4%

31.5%

1.6%

5.5%

26.7%

1.5%

9.4%

9.7%

-0.5%

9.5%

-1.0%

1.5%

3.1%

-4.7%

1.6%

8.7%

1.3%

0 -1.2%

EUR/CHF

1.6% 2.0%

0

Commodities Gold

0.2% -2.7%

1.9%

On our Agenda March 17: Parliamentary elections in the Netherlands The Netherlands has been operating in a temporary political vacuum ever since the country’s government stepped down in January over a child benefits scandal. Continuity, however, is likely because Prime Minister Mark Rutte’s right-wing liberal VVD party is far ahead in the polls.

March 20: International Day of Happiness The United Nations has been celebrating the International Day of Happiness each year since 2013 to remind people how important happiness and well-being are as goals in the lives of humans. It was initiated

by Bhutan, which has been prioritizes the goal of gross national happiness over gross national product.

March 25: SNB monetary policy assessment The SNB‘s upcoming policy meeting is unlikely to spring big surprises. Switzerland’s central bankers are unlikely to see inflation threats and in all probability won’t express intentions to change their interestrate policy. Currency interventions to weaken the Swiss Franc also aren’t necessary at the moment.

12

Monthly Market Monitor - March 2021 | Kaiser Partner Privatbank AG

Kaiser Partner Privatbank AG | Monthly Market Monitor - March 2021

13

This document constitutes neither a financial analysis nor an advertisement. It is intended solely for informational purposes. None of the information contained herein constitutes a solicitation or recommendation by Kaiser Partner Privatbank AG to purchase or sell a financial instrument or to take any other actions regarding any financial instruments. Furthermore, the information contained herein does not constitute investment advice. Any references in this document to past performance are no guarantee of a positive future performance. Kaiser Partner Privatbank AG assumes no liability for the completeness, correctness or currentness of the information contained herein or for any losses or damages arising from any actions taken on the basis of the information in this document. All contents of this document are protected by intellectual property law, particularly by copyright law. The reprinting or reproduction of all or any parts of this document in any way or form for public or commercial purposes is expressly prohibited unless prior written consent has been explicitly granted by Kaiser Partner Privatbank AG. 14

Monthly Market Monitor - March 2021 | Kaiser Partner Privatbank AG

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