We believe stock prices are driven primarily by earnings growth within those international markets poised to outperform. We buy companies that:
- Exhibit sustainable and, ideally, accelerating earnings growth
- Possess high quality balance sheets
- Are managed by strong teams that have a clearly defined growth strategy
All individual growth positions fit into our top-down country allocation framework.
Benchmark: MSCI ACWI ex USA Growth Index
The International Growth Equity investment process is a function of bottom-up growth security selection within a top-down country allocation framework. The bottom up process identifies companies with robust and sustainable growth rates, high-quality balance sheets, and management teams with clearly defined growth strategies. The country allocation model utilizes market valuations, economic growth, risk, and momentum data and serves as a guideline for country and regional weights.
The intersection of our security factor screens and country allocation framework creates the fundamental analysis pool in which the research effort is focused. Fundamental review involves security level review and market level review and confirms the integration of our security selection and country allocation processes. The combination of the two screening systems results in approximately 150 stocks for intensive analysis. The fundamental research effort applied to each selected stock draws on a wide variety of data sources, including economic, industry and company sources, as well as street research, company management visits, and company financial statements. Portfolio construction combines the best candidates within the recommended framework of country allocations resulting in a diversified portfolio.