Global Value Equity Strategy: Our approach to value investing

Transcript

Our approach to value investing

Seb

At its core, our approach seeks to capitalise on market inefficiencies caused by investor overreaction to uncertainty.

Perceptions and share prices can move much more than a company’s true intrinsic value. Our role is to identify those dislocations — where attractive asymmetric risk and reward can be found. Our global platform of sector and industry experts is our edge.

We focus on the most compelling 80 - 100 opportunities across a global opportunity set. And our global platform of sector and industry experts is a key advantage in identifying those opportunities.

Marta

Importantly, we’re not confined to one narrow definition of value.

We invest across the value spectrum; from higher-quality, more defensive companies through to more cyclical and deeper value situations. Different types of value work at different times, and maintaining that balance helps us deliver a more versatile return profile.

How we seek to deliver a more consistent approach to value investing

Marta

Value investing is sometimes associated with specific market regimes. But for us, valuation discipline is a long-term foundation for active performance.

Even in growth-led environments, markets can create inefficiencies — particularly when expectations become extreme.

We combine deep fundamental research with a clear valuation framework to understand the pathway to improvement. That helps us distinguish between genuine opportunity and potential value traps.

 

Seb

Consistency also comes from how we construct the portfolio. We diversify across regions, sectors and across the value spectrum itself - balancing defensive value with deeper value opportunities.

And in today’s environment, with structurally higher inflation and interest rates, the relative value of near-term cash flows becomes increasingly important.

Companies with existing and visible cash flows - which often sit within the value universe - can become more relevant in portfolio construction.

Over the long-term, our focus on intrinsic value and maintaining discipline across cycles has proved to deliver a more consistent pattern of value performance which we believe is increasingly appealing to our clients in what is an ever-changing global environment.

How we work together & with the investment platform

Seb

From a portfolio construction standpoint, we build a diversified portfolio of our highest-conviction 80 to 100 ideas.

Position sizing reflects asymmetry. We assess downside risk first, then upside potential — and the strength of that opportunity determines capital allocation.

Marta

Collaboration is central to our process.

We work closely with T. Rowe Price’s global equity research platform, drawing on deep sector and regional expertise worldwide.

Value opportunities can arise for many reasons — regulatory pressure, strategic change, leverage concerns, or ESG-related issues. In each case, we conduct rigorous bottom-up analysis to understand the fundamental drivers of improvement. A credible catalyst must be present.

 

Seb

That global connectivity gives us both a time and information advantage.

Our longer-term investment horizon allows us to look through shorter-term dislocations created by market overreaction.

 

Closing

Marta

Value investing isn’t simply about buying what looks cheap. It’s about understanding intrinsic

value  and recognising when markets have mispriced it.

Seb

With discipline, global research depth, and a focus on asymmetric opportunities — that’s how we approach our Global Value Equity strategy.