Focused Small Cap Strategy

Why Choose This Strategy?

• As a high active share, concentrated small cap equity allocation.
• As an alpha-generating small cap position based on strong bottom-up fundamental analysis.
• To add a seasoned management team with the ability not only to capture upside market potential but also to protect on the downside.

Investment Strategy

• WCM uses a bottom-up approach that seeks to identify small cap companies with attractive fundamentals, such as strong earnings power, a sound business strategy, and alignment of corporate incentives.
• The managers seek to partner with smart capital allocators (company management) who create strong cultures, and protect/prolong the period of competitive advantage.
• Above-average returns can only be achieved by structuring portfolios distinct from market indices. As a result, the strategy typically holds 25-40 companies, concentrated around the managers’ best ideas.
• Initial position size ranges from 1% to 2%.
• Full position size ranges from 3% to 6% with weightings based on assessment of valuation and quality.