Fund Summary
Schroder
Global Emerging Markets Fund
Overview
The Schroder Global Emerging Markets Fund provides exposure to a range of developing countries
around the world characterised by a stronger growth potential than mature economies. These emerging
countries provide the opportunity for premium returns although with higher risks relative to developed
countries. The investable universe is commonly defined by the MSCI Emerging Markets Index which
covers 21 countries and over 800 stocks.*
Key features
–– Opportunities in developing countries around the world which are typically characterised by a stronger
growth potential than mature economies, offering the opportunity for premium returns but with higher
risk attached.
–– Experienced team consisting of 40 investment professionals with an average of 14 years
investment experience.*
–– Disciplined investment process targeting to add value from both country allocation and stock selection.
–– Strong proprietary stock research database which provides investment professionals with instant
access by intranet to both internal and external research.
* As at 31 Dec 2014
Portfolio summary
Performance objective
o outperform the MSCI Emerging Markets Index (net dividends reinvested)
T
after fees over 3 year rolling periods
Country weights^
+/– 5% of country weight in the MSCI Emerging Markets Index
Sector weights
No formal guidelines
Tracking error
2 – 8% pa. Target 5% pa
No. securities
Typically 90 – 130
^
Investment process
Investment guidelines are as at time of investment and subject to change without notice.
Inputs
Portfolio construction
Country analysis
– Quantitative model
with judgemental overlay
Country allocation (50%)
Risk management and implementation
Model portfolio
Stock analysis
– Fundamental
Portfolio
implementation
Portfolio execution
and monitoring
Stock selection (50%)
We believe that emerging stock markets are inefficient and provide strong potential for adding value
through active fund management. This value can be extracted through both country and stock
selection. We believe that it is inappropriate to apply a systematic style bias across so many countries
at such different stages of development. However, given our strong analytical resources we would
expect to generally have a bias towards medium capitalisation stocks which should provide extra return
potential.
Our aim is to achieve returns with the minimum level of risk through a pro-active approach to risk control.
We believe that applying a systematic, disciplined approach, with a strong team culture increases our
ability to add value.
Fund Summary
Schroder Global Emerging Markets Fund
Investment process (cont.)
Schroders has a balanced approach to investing in Emerging Market equities. We use a mix of top
down analysis and bottom up stock selection and look to derive 50% of our added value from country
selection and 50% from stock selection.
Our investment process begins with gathering and analysing of information on both countries and
stocks which is then used to decide allocations for the portfolio. Country allocation is driven by our
proprietary quantitative model to which the team applies judgmental overlay in a controlled manner.
Fundamental research from our team of locally based analysts forms the basis of the stock selection
process and portfolios are constructed by our three global Emerging Market fund managers focusing on
their highest conviction ideas. We believe that risk management is important in Emerging Markets and
have active risk control processes in place at the portfolio construction stage, including a sophisticated
proprietary risk system and a comprehensive set of portfolio reviews.
What are the risks?
Fund features
Risks associated with investments in emerging markets include but are not limited to significantly greater
price volatility than in developed markets; substantially less liquidity and significantly smaller market
capitalisation of securities markets; more substantial government intervention in the economy; higher
rates of inflation; less government supervision and regulation of securities markets and participants
in those markets and a higher degree of political uncertainty. Schroders actively reassesses and
manages risk at every stage of the investment process. For further details about the risks of investing in
this Fund please refer to the Product Disclosure Statement.
Inception date
25 October 2006
Valuation
Normally every business day
Minimum investment
$25,000
Management costs (ICR)
1.40% pa
Buy/sell spread^
0.40% on application; 0.40% on redemption
Entry/exit fees
Nil
Distributions
Usually the last business day of June and December
mFund code
SCH41
^ Refer to website. Subject to change.
Contact Us
Please call Client Services on 1300 136 471
or email us at info.au@schroders.com
Or visit us at www.schroders.com.au
Investment in the Schroder Global Emerging Markets Fund may be made on an application form in the current Product Disclosure Statement (PDS) which is available from Schroder
Investment Management Australia Limited (ABN 22 000 443 274, AFS Licence 226274) website www.schroders.com.au. The information contained in this flyer is general information
only. It does not contain and should not be taken as containing any financial product advice or financial product recommendations. Before acting on the information contained in this
flyer you should obtain a copy of the PDS and consider the appropriateness of the information in regard to your objective, financial situation and needs before making any decision
about whether to invest, or continue to hold. The repayment of capital and performance of the Fund is not guaranteed by Schroders or any company in the Schroders Group. Opinions
constitute our judgement at the time of issue and are subject to change. Past performance is not an indicator of future performance. Investment guidelines represented are internal only
and are subject to change without notice. For security reasons telephone calls may be recorded.
April 2015 SC991