Global Alpha International Small 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 EAFE Small Cap Index (Net) +3% per year over a full market cycle
• Tracking Error: 3% - 6% per year over a full market cycle
• Portfolio Turnover: 20% - 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
  • Focus on adding value from security selection and minimizing factor risk