Triodos Future Generations Fund: Investor Update Q3 2025

Keep in mind that our commentary on the fund, as well as its past performance, is not a guarantee of what will happen in the future. It is also not financial advice – you should consider speaking to a professional adviser if you're unsure whether an investment is right for you.

These investments are designed to be held for the long term. Like all investments, your money is at risk – investments can go down as well as up, currency fluctuations can affect the value of your investment, and you may not get back what you put in.

How does the fund work?

The Triodos Future Generations Fund invests in companies that are considering the welfare of children and adding benefit for future generations through its products, services, and also the way in which it works. 

Triodos Future Generations Fund focuses on small and medium-sized (midcap) businesses that we have strong conviction in.

When looking for solutions to address the world’s most pressing challenges, especially in impact investing, it is easier to find companies focused on a single product or a single service, as is often the case with small and midcap companies. These small and midcaps are an attractive way to get exposure to a single investment theme or angle, such as child welfare.

Moreover, smaller companies with a strong and viable strategic proposition can have fantastic growth potential, giving them the opportunity to be the big players of tomorrow.

Remember with smaller, entrepreneurial businesses, there’s also more risk that the business might not perform as well as expected. If they decrease in value, investors could get back less than they put in.

Third quarter market overview

The third quarter began with robust gains in global equity markets, as measured by the MSCI World Index. This was led by US equities, where investors shifted focus from earlier tariff concerns to anticipated policy interest rate reductions by the Federal Reserve, as well as emerging opportunities in artificial intelligence. Progress on several trade agreements between the US and its key trading partners also underpinned the positive momentum in markets.

Despite these tailwinds, euro-based investors continued to face challenges from the ongoing weakness of the US dollar, which weighed on returns from dollar-denominated assets. Small-and mid-cap stocks, which are central to this fund, maintained performance on par with large caps throughout the quarter.

Performance update

Q3 was a challenging quarter for the Triodos Future Generations Fund, with underperformance due to weakness in healthcare and consumer-focused stocks, as well as disappointing earnings in some portfolio companies. However, there were bright spots, such as strong gains in the Communication Services sector and a significant rise in Life360 shares. Despite sector headwinds, the fund remains committed to its long-term impact themes.

Investments which contributed to performance

Swedish Orphan Biovitrum delivered strong third-quarter results, with EBITA reaching SEK 3.62 billion, surpassing analyst expectations of SEK 3.21 billion. Total revenue rose 13% to SEK 7.776 billion, highlighted by a 26% increase in Haematology revenue at constant exchange rates. The company also announced plans to commercialize a new drug targeting a genetic disease and provided further details on its ongoing research into a potential treatment for Sepsis. While still in early stages, this new drug is seen as having blockbuster potential.

Thule Group reported Q3 2025 EBIT of SEK 453 million, exceeding estimates of SEK 439.5 million. Shares surged 6.8% on October 22, leading the Stoxx 600 European benchmark. The market reacted positively to stronger-than-expected profitability, which offset concerns about weaker sales.

Investments which detracted from performance 

Tomra reported disappointing third-quarter 2025 results, with revenue declining by 6.1% to EUR 306 million. The recycling segment was particularly weak, as order intake fell by 30%. On a more positive note, Tomra secured several significant contracts for reverse vending machines in the Polish market, including a major order for 3,000 units from Dino Polska.

Gen Digital saw no company-specific news during the quarter. However, software companies in general have been underperforming due to perceived threats from AI. These concerns are not directly relevant for Gen Digital, as the risks largely pertain to enterprise software rather than Gen Digital’s core business.

Return

As of 31/10/2025

Please be aware that there is no calendar year performance data available yet as the fund wasn’t launched until February 2024.

Benchmark: Bloomberg Developed markets Mid & Small Cap Index in EUR converted to GBP. Returns are shown as percentages and calculated on the basis that any income has been reinvested. Returns incorporate the ongoing charges, but do not take into account the impact of the annual service charge on the performance of your investment.