The International Equity Plus Strategy invests in both high quality compounders and value opportunities, primarily in developed markets outside the US. The compounders are characterized by high returns on operating capital employed and strong free cash flow. The value opportunities tend to be more cyclical, with improving or mispriced fundamentals.
The “plus” component of the portfolio consists of high quality compounders in the US, included to increase the portfolio’s quality bias. The overall mix between compounders and value opportunities varies as valuations and prospects change. The strategy seeks to generate superior returns over the long term by providing attractive absolute returns in rising markets and helping to reduce downside participation in challenging markets.