Global Safe Havens Theme

Global Safe Havens is a defensive thematic portfolio that invests in countries with the world's strongest sovereign balance sheets. When global markets come under stress, capital tends to move toward economies that lend more to the world than they borrow, carry low debt and have currencies that hold their value - rather than economies dependent on foreign capital.

To identify these economies, this portfolio screens countries on three measures:

• Current account surplus: the country has earned more from the rest of the world than it has borrowed, on average over the latest three years.
• Low debt: either external debt makes up less than 25% of total government debt or net government debt is below 10% of GDP - showing limited reliance on foreign or excessive borrowing.
• Currency stability: using 20 years of daily exchange-rate data against the US dollar, the standard deviation of daily returns, annualized, must stay below 10% - a statistical measure of how steady the currency has been.

Only countries meeting all three conditions are included, with country-specific ETFs used to gain exposure. This gives investors a rules-based, data-driven way to access economies built to withstand global shocks, rather than relying on subjective country calls.