Investment firm's new global strategy offers potential for higher long-term capital appreciation as managers 'pick their spots'
Toronto-based investment firm Foyston, Gordon & Payne has launched a new fund option for investors seeking long-term capital appreciation from exposure to small- and mid-cap stocks.
The FGP Global Smaller Companies Fund invests in small- and mid-cap equities globally using the quality and value investment philosophy that the firm has built its reputation on for over 40 years. FGP’s Global Equity Team, which manages the fund, also runs the firm’s International, U.S., and Emerging Market equity strategies.
“We are excited to launch the FGP Global Smaller Companies Fund," said Ray Szutu, the lead portfolio manager for the fund. “Our clients can now access our best investment ideas across the entire market cap spectrum.”
According to research, company size is one of several investing factors that contribute to market-beating stock performance, with smaller companies historically generating higher absolute and risk-adjusted equity returns than large companies. The global small- and mid-cap equity universe, FGP said, is a significant segment of the broader market that might not be represented adequately in investors’ portfolios.
According to Szutu, the team has put together a portfolio of leading companies that are predictable and have strong prospects of long-term growth. The constituent companies in the portfolio, he added, were “bought at prudent valuation levels.
“We can better pick our spots among smaller companies,” he said. “Stocks in this space are generally less followed by the broader investment community, which offers an attractive environment for fundamental, bottom-up investors like us.”
