HQAM: Experts for attractively valued quality companies

Active managers specifically try to beat the general market. To achieve this, they have to make active bets and overweight or underweight certain securities. This, in turn, can be approached in very different ways. Either one focuses on fundamental analysis by analysts, or one develops a systematic, rule-based methodology. However, a combination of the two approaches is also often found. In our series, we look at selected active managers. HQAM belongs to the category of fundamental active managers.

The philosophy of HQAM

HQAM is an independent asset manager with a focus on attractively valued quality companies since 2003. A transparent, disciplined process and experienced research ensure quality standards, trust and sustainable alpha generation.

HQAM's quality investment style is traditional, timeless and has its own performance and risk character. The asset manager is convinced that clear, disciplined, systematic and fundamental research is the key to sustainable investment success. The team from Pfäffikon is supported by experienced analysts from its own research center in Riga.

"Corporate excellence, longevity and transparency are our focus, both in the research process and in our client relationships," says Diego Föllmi, CEO of HQAM.

In addition to traditional equity portfolios, HQAM also offers fixed income solutions. These also embody the quality-oriented approach in its purest form. The two asset classes can also be easily combined.

HQAM offers different types of equity portfolios, for example regional quality portfolios (Global, USA, Europe, Switzerland) or those with a different focus on the selected stocks (Top 8, Top 15, Top 25). In addition, HQAM also offers Quality Dividend Portfolios (Global and Switzerland) for investors with a focus on stable income. The HQAM portfolios are generally equally weighted.

How does the HQAM investment process work?

The HQAM investment process consists of 3 steps.

1. the quantitative analysis
In this step, the financial strengths of companies are analyzed, with a particular focus on conservative financing, i.e. little borrowed capital and thus, thanks to equity, always the option of seizing opportunities for future growth in an economically sensible way. It is also examined whether the companies are actively developing their business in order to achieve sustainable growth. On the one hand, the capital must be used profitably, and on the other, there should be competitive advantages. At the same time, any company that passes the first step must also be considered attractively valued.

2 Qualitative analysis
The quality of a company's management is very important for HQAM, as it wants to know whether the management is prepared to master challenges and manage the life cycle. The companies should also have an attractive valuation and a good market position in their chosen field of activity. Sustainability analysis (ESG) should not be neglected either, and HQAM also examines social and environmental aspects.

3. the investment committee
The companies that have successfully passed both steps of our investment process are discussed at the Investment Committee meetings. However, a company is only included in the portfolio if all quality and evaluation criteria are met and all members of the Investment Committee reach a unanimous decision on the purchase. This approach ensures that all parties involved are fully convinced and that there are no uncertainties or concerns.

What's going on with Quality?

2025 was a grueling year for quality investors. While companies with high returns on capital, solid balance sheets, stable margins and clear competitive advantages were regular winners in previous years, they clearly underperformed in 2025.

According to HQAM,one driver of this development was the changed interest rate regime. Inflation is falling, but the market had expected significantly more progressive interest rate cuts in 2025. For quality companies, whose long-term cash flows play a key role in the valuation model, this meant that their valuation premiums could not expand any further.

Despite geopolitical question marks, investors' appetite for risk increased significantly in 2025. Capital flowed into cyclical industrial, energy and financial stocks in Europe, which attracted investors with attractive valuations and visible earnings leverage. In the US, the majority of winners were concentrated around the topic of artificial intelligence (AI), with extremely high valuations in some cases.

The valuation level of individual quality companies also played a role. After years of outperformance, many of these companies were subject to valuation premiums.

The key characteristics of quality companies - high returns on capital, above-average margins, robust balance sheets and reliable cash flows - remain intact according to HQAM. At the same time, it believes that the valuations of many such stocks have fallen back to levels that offer an attractive entry point. What looks like a setback in the short term actually lays the foundation for future outperformance, according to HQAM.

HQAM and ZWEI Wealth

The cooperation between ZWEI Wealth and HQAM goes back more than 10 years. The management of the two companies regularly exchange information and look after clients together. HQAM's ZWEI Wealth Provider Rating of 3.5 is good and reflects the asset manager's experience, specialization and good governance.

HQAM is also committed to transparency and maintains more than 10 standing offers in various risk profiles (fixed income, balanced & equity) on the platform.