The fund seeks capital appreciation by investing in companies that invest in securities of Asian emerging market issuers and other investments that are tied economically to Asian emerging markets.
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.
The investment team considers Asian countries with emerging markets to include Hong Kong, India, Indonesia, South Korea, Malaysia, the Philippines, the People's Republic of China, Singapore, Taiwan, and Thailand.
Next, the research team relies on the perception that due to investor psychology, market microstructure and asymmetric information, markets are not wholly efficient.
The team believes these perceptions result in companies being mispriced and looks to capitalize on these opportunities.
In addition, the team prefers companies with sustainable growth characteristics with an overlay of sound risk management to help enhance returns.
As part of its stock selection process, the team focuses on companies with high potential for structural growth, superior free cash flow and steady high returns driven by excellent business models and proven management teams.
In addition, the team evaluates a company’s financial condition and industry position, as well as market and economic conditions.
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 manager allocates investments across different Asian countries with emerging markets.
