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Global Alpha International Micro Cap Strategy

Highlights

  • Small Cap Specialist: Exclusively focused on the small cap market
  • Experienced & Stable Team: Seasoned partners with proven investment results
  • Rigorous Research: Detailed fundamental research supported by management meetings and secular themes
  • Robust Portfolio Construction: High conviction portfolios driven by security selection and designed to mitigate factor risks

Objectives

  • Added Value: MSCI World ex USA Micro Cap Index (net) +4% per year over a full market cycle
  • Tracking Error: 4% - 8% per year over a full market cycle
  • Portfolio Turnover: 30% - 40% of names per year

Philosophy

  • Earnings growth per share drives stock prices
  • Secular growth themes support outperformance
  • Identify good companies with unrecognized growth potential
  • Long-term investment horizon for value realization

Investment Process

  • Research Prioritization of 7,000 names
    • Engage with companies, including around 1,000 management meetings per year
    • Analyze the universe based on capitalization and quality metrics
  • Fundamental Research
    • Rigorous bottom-up analysis on 250-300 names
    • Seek undiscovered value in companies with strong earnings growth
    • Forecast intrinsic value using a range of valuation tools
  • Investment Themes
    • Find companies expected to benefit from secular growth themes
  • Environment, Social & Governance
    • ESG factors integrated into investment analysis
    • Utilize proprietary scoring system designed for the small-cap universe
  • Portfolio Construction & Risk Management
    • Build high conviction portfolios of 50-70 stocks with market capitalization generally between US$1 million and US$1 billion
    • Focus on adding value from security selection and minimizing factor risk
Quick Facts
Inception Date October 16, 2017
All data as at: Sep 29, 2020
Geographic Mix
% of Portfolio
Japan 31.33%
United Kingdom 13.89%
Australia 9.80%
Sweden 9.63%
Canada 8.06%
France 7.92%
Hong Kong 4.98%
Austria 3.01%
Germany 2.74%
Norway 2.14%
Ireland 1.79%
Singapore 1.46%
Switzerland 1.39%
Italy 1.06%
Denmark 0.79%
All data as at: Sep 29, 2020
Sector Allocation
% of Portfolio
Information Technology 22.25%
Industrials 21.40%
Consumer Discretionary 11.53%
Health Care 10.54%
Consumer Staples 8.65%
Materials 8.32%
Financials 6.16%
Utilities 2.92%
Real Estate 2.58%
Communication Services 2.55%
Cash 2.50%
Energy 0.61%
All data as at: Sep 29, 2020
Top 10 Securities
% of Portfolio
Clipper Logistics Plc 3.65%
Poletowin Pitcrew Holdings 3.02%
Nihon Chouzai Co Ltd 2.88%
Nissin Foods Co Ltd 2.82%
Flatex AG 2.67%
Yumeshin Holdings Co Ltd 2.55%
Mnf Group Ltd 2.55%
Taiyo Holdings Co Ltd 2.49%
Anicom Holdings Inc 2.46%
Makino Milling Machine Co 2.21%
All data as at: Sep 29, 2020
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