The fund seeks to provide total return by investing in companies across any size outside the United States.
The sub-adviser’s investment process starts with a list of companies in the benchmark index and the research team utilizes quantitative techniques and fundamental analysis to identify investment opportunities.
Next, the research team invests in securities of companies in the real estate or real estate-related industries.
The team focuses on companies that qualify for U.S. federal income tax purposes as real estate investment trusts, or entities similar to REITs formed under the laws of a country other than the U.S.
In addition, the team considers companies located in any country that derive at least 50% of their revenues from the ownership, construction, financing, management or sale of commercial, industrial or residential real estate or that have at least 50% of their assets invested in such real estate.
Also, the team considers companies located in any country that are primarily engaged in businesses that sell or offer products or services that are closely related to the real estate industry.
In selecting securities for the portfolio, the research team employs a research-based investment process that combines top-down market research, bottom-up company analysis and a quantitative assessment of relative value.
The top-down analysis focuses on an understanding of economic conditions and real estate fundamentals.
The research process is driven by fundamental analysis of one stock at a time. As part of the bottom-up analysis, the team focuses on understanding each company’s risk profile and growth prospects.
The quantitative assessment of relative value includes ranking companies on the basis of premiums and discounts to intrinsic value.
Then the manager constructs a portfolio of stocks from a list of companies favored by the research team and allocates capital based on its conviction level.
The fund may invest in companies located in any country, including any emerging market country.
Also, the fund invests at least 40% (or, if the manager deems it warranted by market conditions, at least 30%) of its net assets in securities of non-U.S. issuers.
Additionally, the fund has the flexibility to invest across market capitalizations but may invest significantly in large- and mid-capitalization companies.
The fund is non-diversified, meaning that it may invest a significant portion of its net assets in a limited number of issuers.