Investment Approach & Decision Making

The financial markets are inherently fractured and inefficient — mainly due to the short-term focus of most investment research. This creates mispricing opportunities that can be exploited to add value to client portfolios. Fundamental proprietary research is therefore critical to identifying which securities offer the greatest upside potential. At Schroders, we believe that buying attractively valued companies with good growth prospects and solid earnings will produce superior returns relative to the benchmark.

Although we focus our resources on security selection, which we believe to be a consistent and reliable source of added value, we seek to identify pricing anomalies between countries and therefore adopt an integrated approach to security selection and country allocation.

We adopt a team approach to decision making. Using our global research platform, we apply a consistent methodology to assessing companies, global sectors, countries and currencies.

Our decision making process is made up of the following four key steps:

• Research
• Screening & Ranking
• Identifying Catalysts
• Portfolio Construction

While local research analysts have responsibility for visiting companies and making earnings projections, our London-based portfolio management teams have responsibility for stock selection and portfolio construction.