North American Equity
Investment objective
Schroders North American Equity strategy is managed to outperform the S&P 500 (before fees) by 0.75% per annum with a very low tracking error.
Key features
The key strength of our investment approach is the proven ability to produce consistent, repeatable performance while taking limited index-relative risk. The strategy seeks to generate positive excess returns in the future as a result of:
- A Fundamental Basis – Our stock selection starts with two key fundamentals: Value and Quality. We measure Value on both an absolute and relative basis while Quality is captured through analyzing the underlying building blocks of a company, namely Profitability, Stability and Financial Strength.
- Behavioral Analysis – After evaluating company fundamentals we use a ‘decision tree’ approach to produce a final stock ranking, we believe our approach more closely matches how many investors actually evaluate companies to arrive at investment decisions.
- Efficient Risk Management – We carefully manage top-down risks, such as market direction, currency or sectors, which are on average inherently difficult to forecast consistently. We diversify the portfolio across over 300 stocks, while efficiently managing multiple themes and investment strategies.
- Forward Looking Research – We believe in innovation not extrapolation. We are always looking to develop new research insights according to changing market conditions and when analyzing past relationships we seek to understand both their rationale and context.