Finding new opportunities: Cambridge Global Smaller Companies Fund

September 22, 2020

The Cambridge Global Smaller Companies Fund provides long term capital appreciation by investing primarily in companies located globally with a market cap of US$250M to US$10B. The team focuses on value-creating businesses with durable competitive advantages.

Why global small caps – and why now?

Firstly, it’s worth noting that the global small-cap universe is significantly different to the local small-cap universe.

  • The global small-cap universe (MSCI World Small Cap) is a lot larger, with 4,288 constituents. Compare this to the S&P-ASX Small Ordinaries, with 200 constituents
  • The market cap range of the global universe is US$34 million to US$14,039 million, while the market cap range of the domestic universe is A$110 million to $6,475 million
  • As well as being a much larger universe, many global small caps are significantly larger than their Australian counterparts. As such, there’s greater diversification in terms of market cap, industry and the products and services offered.

As well as a strong investment thesis for global small caps, it may also be a great time to invest. As illustrated, global small caps have traditionally experienced significant outperformance following a recessionary environment. Given the economic uncertainties presented by COVID-19, the near-term environment may be positive for global small caps.

Click here to learn more about the Cambridge Global Smaller Companies Fund.




© GSFM 2020