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Mirabaud Equities Swiss Small and Mid Strategy
STRATEGY OVERVIEW
Mirabaud Equities Swiss Small and Mid Strategy
A high-conviction, active equity strategy that targets quality Swiss small and mid-cap names, combining what we believe to be the best growth and value companies in the investment universe.
The strategy aims to achieve higher risk-adjusted returns than its benchmark, the SPI EXTRA Index, over a full cycle, through active management and stock selection based on bottom-up analysis of company fundamentals.
Guided by in-depth research, we get to know companies where we see potential opportunities, with the intention to invest for the long term. We are able to leverage our strong Swiss franchise to deeply connect with management teams.
Why Swiss equities?
A local market with a global footprint. Swiss companies have geographically diversified revenues. In the small and mid-cap sector, 90% of revenues are generated from outside Switzerland.
Swiss small and mid-caps are relatively less covered by analysts, creating opportunities for active managers to identify potentially mispriced stocks.
Portfolio Characteristics
| CONCENTRATED | 40-50 high conviction holdings with diversified investment drivers. |
| UNCONSTRAINED | The strategy is benchmark aware, but not benchmark constrained, meaning we have the flexibility to invest opportunistically in non-index securities. |
| BOTTOM-UP | We pair our stock-picking approach with patience and discipline. Security selection drives performance. |
| SFDR ARTICLE 8 | ESG is fully integrated through exclusions, integration, and active ownership strategies. |
Investment Philosophy
We are high-conviction active managers and we believe in investing in quality companies. Our investment philosophy centres around three core beliefs:
- Over the long-term, the share price follows the development of the company's earnings power.
- Companies are living creatures that constantly evolve, but rarely change DNA. Understanding each business is crucial.
- Companies that focus on generating and growing free cash flow sustainably, and allocate capital profitably, will compound value for investors.
Our goal is to identify ‘compounders’ that display the following characteristics:
Identifying compounders
HIGH ROCE*
We target companies capable of generating high returns on capital and that strives to ensure the sustainability of those returns over an extended timeframe.
identifying compounders
SMART CAPITAL ALLOCATION
Future value creation hinges on a company’s ability to identify projects generating a positive spread between return on invested capital and the cost of capital.
Identifying compounders
DEFENDABLE MOAT
A company's competitive advantage, or "moat", provides protection against competition, market saturation, disruptive business models and other challenges.
identifying compounders
SUSTAINABLE GROWTH RATES
Be it in the top-line, margin or free cash flow.
* Return on capital employed
We firmly believe that portfolios centred around compounding companies at discounted valuations offer a reliable and robust path to long-term capital appreciation.
Equity Insights
Contact
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Asset management
Benjamin CARTER
Head of UK Wholesale