Neuberger Berman is to launch a Ucits version of a US small cap strategy that has outperformed the Russell 2000 Index by 5.39% per annum over the past decade.
Lead portfolio managers Judy Vale and Robert D’Alelio have been managing the strategy for more than 15 years, backed by two other portfolio managers and 40 Neuberger Berman research analysts.
Neuberger Berman says returns have been achieved “at materially less risk” than its peers, and say that the strategy has a relatively low portfolio turnover that enables the team to arbitrage against “the typically short time horizon that drives most of its peers”.
“The team focuses on companies that generate free cash flow and are not in need of external financing. The team believes this is the least efficient segment of the small cap market and where they are able to find the best investment opportunities, as these companies tend to receive less coverage from the investment banking driven firms,” the firm said.
The fund will be launched in the business’ Ucits fund umbrella, the Neuberger Berman Investment Fund.
