Applying a strict value investing discipline rooted in Graham & Dodd principles, Brandes Investment Partners® searches worldwide for attractive investment candidates. Our Global Small Cap Equity Portfolio contains what we believe to be undervalued, smaller-sized companies from around the globe.
Typically, investment candidates in the small-cap segment tend to attract less coverage by research analysts than their large-cap counterparts, creating a greater possibility for us to take advantage of unrecognized investment opportunities. Using a disciplined research process that investigates the merits of individual firms on a company-by-company basis, we believe we can identify good values within the smaller-cap segment in virtually any part of the world.
Generally, a security will be bought if it is trading below what we believe to be its estimated value. This conservative approach strives to provide investors with both a margin of safety and long-term appreciation potential. Individual security selection drives the portfolio’s country and industry allocations.
Historically, smaller-cap companies have rewarded patient investors with greater returns relative to larger-cap stocks. While small-cap securities have a record of better long-term performance, they pose unique risks for investors. For example, such companies may lack the stability and extensive resources often associated with larger-cap firms. In addition, investing in smaller-cap companies outside the United States may subject investors to political, economic,and currency risks.
For a more complete description and discussion of asset mix and risk, consult Brandes' Form ADV, Part II.