James Eisenman from Vaughan Nelson appeared on Ausbiz’s Small Cap Big Ideas event to discuss the inherent attractiveness of global small and mid cap equities (SMID caps) as well as his future outlook for the asset class.
During the interview James talked about how global SMID caps:
- Have performed better than global large caps over the last 15 years, with similar risk and volatility
- Have an average market cap of A$9 billion which is roughly the same size as Sonic Healthcare (only 7 or 8 Aussie companies would be too large to fit into the global SMID index)
- Hit an investing ‘sweet spot’ – big enough to be well established, successful businesses but earlier in their life cycle than many large caps, so more room for growth
- Are often under-represented in Australian investors’ portfolios, so offer diversification benefits, as well as access to different markets, geographies, economic cycles and underlying business drivers
This information is provided for general information purposes only and does not take into account the investment objectives, financial situation or needs of any person. Investors Mutual Limited (AFSL 229988) is the issuer and responsible entity of the Vaughan Nelson Global Equity SMID Fund and the Vaughan Nelson Global Equity SMID Fund (Quoted Managed Fund) (‘Funds’). Vaughan Nelson Investment Management, L.P. is the investment manager.
This information should not be relied upon in determining whether to invest in the Funds and is not a recommendation to buy, sell or hold any financial product, security or other instrument. In deciding whether to acquire or continue to hold an investment in the Funds, an investor should consider the current Product Disclosure Statement and Target Market Determination for the appropriate class of the Fund, available on the website www.VaughanNelson.com.au or by contacting us on 1300 219 207.
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