Schroder Sustainable Global Core Fund
An actively managed, highly diversified global equity fund that provides the benefits of index-based investing from a risk and cost perspective with the advantage of relative performance upside potential across a broad range of market environments.
This product is likely to be appropriate for a consumer seeking capital growth for a small or core component of their portfolio, with a high or very high risk and return profile. This product is unlikely to be suitable for a consumer seeking capital preservation or income. This product is also unlikely to be suitable for consumers seeking a standalone solution with a low risk and return profile or a short investment timeframe.
To outperform the MSCI World ex Tobacco Index (net dividends reinvested) after fees with low index-relative risk across a broad range of market environments.
The benefits of investing in the Fund include:
- Global diversification through a highly diversified portfolio, which minimises stock-specific risk. Our research suggests that there is a long-term premium available to investors focused on valuations and on business quality. We exploit this through the Fund's broad investment universe of over 10,000 stocks globally.
- Our ‘value’ strategy means that the value of a security is analysed using a wider variety of metrics, including dividends, cashflows, earnings and assets, both on an absolute and relative basis to identify securities which Schroders believes have been undervalued by the market (Value). Our ‘quality’ strategy involves analysing companies with regard to profitability, stability, financial strength, governance and potential for structural growth (Quality).
- Limited index-relative risk as top-down risks are carefully managed by applying index-relative limits on the weights of regions, sectors and stocks in our portfolio construction process.
- Dedicated and well-resourced QEP investment team with clear ownership and accountability for meeting the investment objective of the Fund.
- Market risk: includes the risk of volatility and negative returns arising from factors that affect investment markets.
- Equities risk: includes the risk that changes in share prices will negatively impact on the value of investment.
- International investments risk: includes the risk that international political, economic or currency events negatively impact the value of investments.
- Emerging Markets/Frontier Markets risk: includes the risk of significantly higher price volatility, less liquidity and greater political risk than in developed markets.
- Sustainability risk: the risk that the Fund may have limited exposure to some companies, industries or sectors and may forego certain investment opportunities, or dispose of certain holdings, that do not align with its sustainability criteria applied by Schroders as the investment manager.
The above list of risks is not conclusive. For a comprehensive list of risks please refer to the PDS.
|Fund Inception date||31 October 2002|
Wholesale class - $20,000
|Buy/sell spread^||0.15% on application and 0.10% on withdrawal|
|Management fees and costs||
Wholesale class - 0.30% p.a.
Wholesale & Professional class: Normally last business day of June and DecemberInstitutional class: Accumulation only
|mFund code||SCH31 (only wholesale class available)|
^Subject to change. Refer to the Buy/Sell spreads page in the Fund Centre
*Additional fees and costs may apply. Please refer to the product disclosure statement for further details.
HOW THE FUND IS MANAGED
Our investment process can be summarised in three stages:
Stage 1: Fundamental drivers
Our starting point is the universe of over 10,000 companies with ESG data coverage. We then apply exclusions for companies facing increased ESG risks given the nature of their business involvements. All stocks in QEP's global universe are assessed in terms of their value and quality as well as their sustainability (using our proprietary QEP ESG Rating). Our QEP ESG Rating incorporates a wide spectrum of ESG considerations. The value of a company is determined across measures of dividends, cashflow, earnings and assets. Quality is assessed using measures of profitability, stability, financial strength, governance and potential for structural growth. Our ranks are re-calculated on a daily basis in order to ensure that the latest information is incorporated e.g. price movements and company fundamentals.
Stage 2: Stock selection, including ESG integration
Of the stocks which meet our Stage 1 requirements we then decide whether to invest in each one, and if so how much, by assessing their ESG characteristics, company fundamentals, liquidity and volatility. For more information on how the fund takes into account ESG considerations, please refer to the Fund’s PDS.
Stage 3: Portfolio construction
Awareness of risk management is integrated throughout our investment process and in particular in portfolio construction. The most critical role of our portfolio managers is to understand when stocks are attractive on a risk-adjusted basis, maximising return opportunities within a comprehensive risk framework. Portfolios are exceptionally diversified, accessing a genuinely broad opportunity set across countries, sectors and market capitalisations, while reducing stock-specific risk. Stock selection is primarily driven by bottom-up decisions made on the basis of our evaluation of a company’s ESG characteristics, stock fundamentals and other metrics as described above. Sector, country and regional allocations are generally allowed to build from our stock selection process – we only invest where we see the best opportunities.
Currency exposure is typically unhedged however currency derivatives may be used with equity index futures in managing cash flows or to manage active currency positions relative global equity indices for risk management purposes.
Labour standards and environmental, ethical and social considerations
The Fund is managed with reference labour standards, and environmental, social and ethical (ESG) considerations when selecting, retaining and realising the Fund's investments by applying revenue exclusion screens (referred to as Negative Screens) and assessing companies on ESG characteristics. Schroders will then decide whether a company is eligible for inclusion in the Fund, based on this assessment and when determining position sizing within the portfolio.
The rating issued April 2022, APIR: SCH0003AU, is published by Lonsec Research Pty Ltd ABN 11 151 658 561 AFSL 421 445 (Lonsec). Ratings are general advice only, and have been prepared without taking account of your objectives, financial situation or needs. Consider your personal circumstances, read the product disclosure statement and seek independent financial advice before investing. The rating is not a recommendation to purchase, sell or hold any product. Past performance information is not indicative of future performance. Ratings are subject to change without notice and Lonsec assumes no obligation to update. Lonsec uses objective criteria and receives a fee from the Fund Manager. Visit lonsec.com.au for ratings information and to access the full report. © 2022 Lonsec. All rights reserved.
The Zenith Investment Partners (ABN 27 103 132 672, AFS Licence 226872) (“Zenith”) rating (assigned APIR: SCH0003AU, March 2022) referred to in this piece is limited to “General Advice” (s766B Corporations Act 2001) for Wholesale clients only. This advice has been prepared without taking into account the objectives, financial situation or needs of any individual, including target markets of financial products, where applicable, and is subject to change at any time without prior notice. It is not a specific recommendation to purchase, sell or hold the relevant product(s). Investors should seek independent financial advice before making an investment decision and should consider the appropriateness of this advice in light of their own objectives, financial situation and needs. Investors should obtain a copy of, and consider the PDS or offer document before making any decision and refer to the full Zenith Product Assessment available on the Zenith website. Past performance is not an indication of future performance. Zenith usually charges the product issuer, fund manager or related party to conduct Product Assessments. Full details regarding Zenith’s methodology, ratings definitions and regulatory compliance are available on our Product Assessments and at Fund Research Regulatory Guidelines.