Investment Approach

At the heart of the strategy’s philosophy is the belief that the Japan small cap market is not efficiently priced due to the relative lack of coverage by asset managers. There are too many companies in the investible universe that are under-researched, with little or no coverage. Consequently, the small cap universe provides numerous opportunities for active managers to find mispriced stocks.

The portfolio manager has a disciplined investment style where he focuses on PER –price to earnings ratio-, which we believe is the most effective indicator in Japanese small cap market. We typically hold a stock until the market notices and corrects the undervaluation. We can be patient because our extensive company research ensures stability and strength of fundamentals of invested companies. The manager is unrivalled in terms of the volume of company research he has conducted during his career.  He has met a few thousand companies in his career and counting, and continues to meet around 900 companies in a year now, providing an enviable knowledge bank of insights into the small cap market.

Why Japan Equity Small Cap Absolute Value?

Award-winning portfolio manager: Having managed the strategy since inception, Tatsuro Nigauri has received prizes from the R&I Fund Contest (2012, 2013, 2014 and 2015), as well as the Lipper Fund Awards Japan (2012 and 2013) and J Money Fund Awards (2016). As a result, Mr Nigauri is well known by companies’ management in the sector and they will often make him their first call when organising investor relations trips, helping to free up time for Mr Nigauri and his team.

Distinctive Value-biased investment approach: By adopting a distinctive Value-biased investment approach and focusing on extensive research gleaned over the course of over two decades of research into small-cap Japanese equities, Mr Nigauri is able to unearth companies with true earnings potential and exploit opportunities that exist within the niche Japanese small-cap market.

Local expertise and native Japanese equity portfolio managers: Direct and easy access to an often opaque Japanese market gives us the ability to navigate the idiosyncrasies of the small and micro-cap market. Given how crucial assessment of company management is in this area, we feel this gives us an advantage over our competitors.

SFDR Sustainability Reports

SMDAM Sustainability Homepage

SFDR Disclosure – Japan Equity Small Cap Absolute Value (Article 6)

Investment Approach

We believe that market inefficiencies result in share price overvaluation and undervaluation from time to time. Our investment philosophy is to “achieve stable excess returns through active management” in the long-term by taking advantage of market inefficiencies.

We achieve these goals by:

Analysing fundamentals from a global perspective

Investing actively through a well-defined and structured process

Maintaining a consistent investment style with comprehensive risk management

Product Philosophy

Our investment management philosophy for the Japan Equity Fundamental Active product is derived from our belief that, even in a generally recognised value oriented Japanese market, it is possible to generate greater alpha by effectively combining quality value and earnings momentum focused growth stocks in a portfolio. We achieve this through rigorous fundamental research to identify catalysts for price appreciation ahead of the market, without taking undue risk.

Style

Our Japan Equity Fundamental Active product is designed to be style agnostic and it aims to provide excess returns by utilising a combination of flexible value and earnings momentum driven fundamental stock selection with sector allocation overlay.

Competitive Advantage

Style Agnostic: Freedom to generate alpha in all market conditions and not be style led. The benefit of not being a purely traditional value strategy

Agile Approach: Whether there is a preference for value or growth, large, mid or small caps, our agile approach to the Japanese market has led to outperformance in most scenarios

Local expertise and native Japanese equity portfolio managers: The ability to deal with the idiosyncrasies of the market allows the PM’s to effectively pick attractive stocks across the market cap spectrum

Consistent Outperformance: Alpha generated without taking undue risk

SFDR Sustainability Reports

SMDAM Sustainability Homepage

SFDR Disclosure – Japan Equity Fundamental Active (Article 6)

Investment Approach

We believe that market inefficiencies result in share price overvaluation and undervaluation from time to time. Our investment philosophy is to “achieve stable excess returns through active management” in the long-term by taking advantage of market inefficiencies.

We achieve these goals by:

Analysing fundamentals from a global perspective

Investing actively through a well-defined and structured process

Maintaining a consistent investment style with comprehensive risk management

Product philosophy

The theory behind our investment management philosophy for Japan Equity Value + Alpha is derived from our belief that, even in a generally recognised Value oriented Japanese market, it is possible to generate greater alpha by effectively combining good quality, earnings driven, flow value focused stocks in a portfolio through rigorous fundamental research to identify catalysts for price appreciation ahead of the market, without undue risk.

Style

We would classify our investment style for this product as fundamental bottom-up earnings driven Value style.

SFDR Sustainability Reports

SMDAM Sustainability Homepage

SFDR Disclosure – Japan Equity Value + Alpha (Article 6)