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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 23, 2021
Geographic Mix
% of Portfolio
Japan 29.42%
United Kingdom 15.56%
Australia 9.74%
Canada 9.59%
France 6.83%
Germany 4.46%
Italy 4.23%
Austria 4.09%
Norway 3.83%
Hong Kong 3.48%
Sweden 2.12%
Denmark 2.11%
Singapore 1.88%
Ireland 1.67%
Switzerland 0.99%
All data as at: Sep 23, 2021
Sector Allocation
% of Portfolio
Industrials 24.03%
Information Technology 18.05%
Consumer Discretionary 12.18%
Health Care 10.45%
Materials 9.60%
Consumer Staples 7.04%
Communication Services 5.26%
Real Estate 3.55%
Financials 3.18%
Cash 2.71%
Energy 2.17%
Utilities 1.77%
All data as at: Sep 23, 2021
Top 10 Securities
% of Portfolio
Mnf Group Ltd 3.26%
Zuken Inc 2.66%
Gym Group Plc/The 2.60%
Clipper Logistics Plc 2.60%
Extendicare Inc 2.50%
Animalcare Group Plc 2.39%
Nippon Ceramic Co Ltd 2.24%
Makino Milling Machine Co 2.22%
Atalaya Mining Plc 2.16%
Poletowin Pitcrew Holdings 2.10%
All data as at: Sep 23, 2021
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