The Global Equity team of Nikko Asset Management Europe is the investment manager of the Nikko AM Wholesale Global Shares Fund. The process delivers a high active share, differentiated global equity portfolio that aims to provide superior returns through a disciplined and clear investment process. The Strategy will hold between 40-60 stocks, weighted to reflect the alpha conviction in individual holdings.
Experience, Future Quality, Execution
Experience:Significant diversity of professional background and combined breadth of experience through a variety of market cycles and crises across global investment markets enables them to ‘join the dots’, applying their knowledge to think laterally and pragmatically to find the best available investment opportunities.
Future Quality:The team believes that superior returns on capital over the long term will deliver better performance. The common feature of the ideas that make it into a client's portfolio is what the team class 'Future Quality'. Future Quality means any company where the growth in future cashflow, its sustainability and the level of returns to investors is not reflected in the share price today. The team assesses companies to understand the quality of management, the quality of the company franchise, the quality of cashflows and balance sheet.
Execution:The team believes that effective execution of the process relies on a culture of focused collaboration to achieve one goal: high conviction portfolios that aim to achieve the best outcomes for clients.
It is this combination of extensive experience, flexible free-thinking and effective execution that offers a compelling and differentiated outcome for clients.
Investing in future quality companies with sustainable growth characteristics at attractive valuations will lead to outperformance over the full market cycle
- Long–term and fundamentally driven: Only invest in companies that the team has thoroughly researched and debated.
- Free-thinking: When picking stocks, an open mind about each investment case is more likely to identify the winners of tomorrow.
- Debate and Insight: Diverse experience leads to better investment decisions and outcomes for our clients.
- Future quality: Believe that sustainable and superior returns on capital over the long run will deliver better compounded returns.
The team identifies businesses with, or with a path to, high and sustainable returns, which are under-appreciated by the market. We describe these as ‘future quality’:
- Quality of franchise: Believe that sustainable and superior returns on capital over the long term will deliver better compound returns. Business franchises evolve, so the focus is on future returns.
- Quality of management: The leadership and culture of a business can have a significant bearing on its future growth. Look for strategic vision, strong internal leadership and a high standard of corporate governance.
- Quality of future valuation: The future return on investment and the growth of a company’s cash flows are key focus points and our research models forecast these in detail. Seek companies where the future is not reflected in today’s valuations.
- Quality of balance sheet: Prefer to invest in businesses that can finance future organic growth using their own capital.
The Nikko AM Wholesale Global Shares Fund seeks to provide investors with a relatively concentrated actively managed investment portfolio of global equities to achieve long term capital growth.
To outperform the MSCI ACWI, with net dividends reinvested, expressed in NZD (unhedged) by 3% per annum over a rolling three year period before fees, expenses and taxes.
MSCI All Countries World Index (net dividends reinvested) - NZD unhedged
Foreign currency exposures created as a consequence of capital markets investments are gross hedged at 139% to NZD with a permitted operational hedging range of 134% to 144%.