Quilter Cheviot’s sustainable investment team has added three new holdings to its Climate Assets Balanced fund.

The team made the decision in light of Donald Trump’s re-election as US President, DeepSeek’s ‘burst’ onto the artificial intelligence (AI) scene, and the expectation that interest rates will remain elevated.

Following the recent sell-off in AI-focused companies, Quilter Cheviot has added Nvidia to the fund after it fell by nearly 20 per cent at the end of January.

“Despite all the fanfare of DeepSeek and its supposed ability to create large language models in a less capital-intensive manner, Nvidia remains the leader in the design and production of graphics processors units (GPUs),” stated Quilter Cheviot sustainable investment team investment manager, Harry Gibbon.

“Notably, over 90 per cent of the supercomputers around the world are powered by Nvidia so it has a dominant position and thus the dramatic market reaction created a great buying opportunity.

“Whilst we expect market returns to broaden out this year, we still expect the tech sector and the Magnificent Seven to do much of the heavy lifting.

“Following its recent share price falls, Nvidia now has a much more balanced risk reward return profile and thus is a good time to take advantage of favourable metrics for a company that remains at the forefront of the vast majority of global economic activity.”

The second holding added to the Climate Assets Balanced fund was insurance company Allianz, with Gibbon noting that it "made sense" to have exposure to one of the world’s leading insurers as the insurance industry would play a key role in accelerating the energy transition, protecting against extreme weather events, and supporting recovery post-catastrophes.

“We like the resilience of its business model offering, diversifying by business segment and geography,” he continued.

“Its health and life insurance products and services contribute to the target of achieving universal health coverage, including financial risk protection and access to quality healthcare services – making aligned to the SDGs.

“Furthermore, premiums are rising in the non-life insurance space, and Allianz has good exposure to those markets. The company is well-established in the US which we like as it has strong sensitivity to the US dollar and stands to benefit from a higher interest rate environment.

“Allianz also offers an attractive dividend yield of around 4.5 per cent, giving investors potential for both a solid income and good capital returns.”

Finally, Quilter Cheviot’s sustainable investment team decided to introduce testing company Intertek to the Climate Assets Balanced fund portfolio.

“The testing, inspection, and certification (TIC) industry has seen robust growth in recent years and there is no sign of this slowing down,” Gibbon said.

“As such, a company such as Intertek, offers huge potential due to it being a global leader underappreciated by the market.

“We think investors underestimate Intertek’s diverse and global footprint. It only generates about 18 per cent of its revenues from China, and less than 3 per cent of group revenue is generated from US consumer testing exports, so it should be fairly well insulated from Donald Trump’s tariff regime.

“The business experienced a big sell off in its share price at the end of last year and looks undervalued compared to its long-term average.”

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