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Wasatch Global Small Cap Strategy

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Global Small Cap Strategy
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Strategy Overview

Highlights
  • Seeks the highest-quality growth companies across the globe
  • A high-conviction portfolio consisting primarily of companies held in other Wasatch strategies
  • Truly active, collaborative, bottom-up, fundamental process
  • Broad sector and country approach
  • Also available as a developed markets only strategy with no emerging markets exposure
Investment Approach

We use a bottom-up approach that seeks to identify companies with outstanding long-term growth potential. We look for companies with:

  • Strong financials
  • A sustainable competitive advantage
  • Industry-best management teams
  • Earnings growth greater than the relevant sector or industry

A true fundamental research-driven “Best of Wasatch” portfolio: holdings must be owned with conviction in other Wasatch small-cap strategies

Geographically diverse mix of companies with market caps of less than $5 billion at the time of purchase

Approximately 70-100 positions

Portfolio Managers
JB Taylor JB Taylor Lead Portfolio Manager
8 years on strategy
23 years at wasatch
Ajay Krishnan Ajay Krishnan Lead Portfolio Manager
7 years on strategy
25 years at wasatch
Ken Applegate Ken Applegate Portfolio Manager
< 1 year on strategy
5 years at wasatch
Paul Lambert Paul Lambert Portfolio Manager
< 1 year on strategy
19 years at wasatch
Quick Look
As of 12/31/19
Total Assets*
$1,406m
Mutual Fund
$133.0m
Separate Accounts
$1,273m
Inception Date
11/17/08
Account Minimum
$10m
Primary Benchmark
MSCI AC World Small Cap Index

*Total strategy assets across all vehicles and composites

Documents
Fact Sheet
Commentary
15 Cumulative PM years on strategy

Our approach can be described as ‘The Best of Wasatch’ because our holdings include the developed- and emerging-market companies in which we have the highest conviction.”

—JB Taylor, Lead Portfolio Manager

Performance

Average Annual Total Returns AS OF 12/31/19 AS OF 12/31/19
Quarter-End Month-end
1 Month
3 Month
ytd
1 yr
3 yr
5 yr
10 yr
Since
Inception
Global Small Cap Composite (Gross)
2.67%
10.42%
35.13%
35.13%
21.20%
12.70%
13.66%
18.18%
Global Small Cap Composite (Net)
2.61%
10.17%
33.65%
33.65%
19.77%
11.31%
12.07%
16.48%
MSCI AC World Small Cap Index
3.73%
9.74%
24.65%
24.65%
9.73%
7.85%
9.71%
13.48%

Returns for periods less than one year are not annualized. Since inception performance is calculated from 11/30/2008.

Calendar Year Returns (%) NET OF FEES (AS OF 12/31/19)
Global Small Cap Composite
MSCI AC World Small Cap Index

Performance is preliminary and subject to change. Past performance is not indicative of future results. Wasatch Global Investors is an independent registered investment advisor. Registration does not imply a certain level of skill or training. Wasatch claims compliance with the Global Investment Performance Standards (GIPS®). To receive a complete list of composite descriptions of Wasatch composites and/or a GIPS-compliant presentation, e-mail inforequest@wasatchglobal.com. The U.S. Dollar is the currency used to express performance.

The Global Small Cap Composite contains fully discretionary equity accounts following the Global Small Cap style.  The composite primarily invests in small and micro cap companies in both domestic and foreign markets with the goal of long-term growth of capital.  Typically, portfolios within the composite invest in smaller companies but may also invest in larger companies where the appropriate criteria is met.  For comparison purposes the composite is measured against the MSCI AC World Small Cap index.

The MSCI AC World Small Cap Index is an unmanaged index representing developed and emerging markets.

MSCI makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used to create indices or financial products.

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Portfolio

Characteristics AS OF 12/31/19
Portfolio
Index
Number of Holdings
75
5983
Average Market Cap
($ Weighted)
$5.66b
$3.22b
Median Market Cap
$3.24b
$1.05b
EPS Growth (%, est. 5 yr)
22
12
P/E (Forward)
29
16
Portfolio Turnover (%)
22.11
n/a
Active Share (%)
98
n/a
Performance Statistics AS OF 12/31/19
5 yr
Alpha
4.81
Beta
0.98
R-Squared
0.75
Standard Deviation
14.43
Upside Capture
109
Downside Capture
81
Top 10 Holdings AS OF 09/30/19
Company
% of Net Assets
Trex Company Inc.
3.1%
Euronet Worldwide Inc.
2.9%
Copart Inc.
2.7%
Globant SA (Argentina)
2.6%
AU Small Finance Bank Ltd. (India)
2.4%
RBC Bearings Inc.
2.2%
MercadoLibre Inc.
2.2%
Ensign Group Inc/The
2.1%
Monolithic Power Systems Inc.
1.9%
Knight-Swift Transportation Holdings Inc.
1.9%
75 Number of holdings
98% Active share
Sector Allocation AS OF 12/31/19
Sector
Portfolio
Index
Industrials
25.8
17.2
Information Technology
25.5
13.2
Financials
15.8
13.6
Health Care
14.0
10.6
Consumer Discretionary
10.6
12.3
Consumer Staples
4.1
4.6
Materials
2.1
7.4
Real Estate
0.7
11.2
Cash & Cash Equivalents*
0.7
0.0
Communication Services
0.7
3.6
Energy
0.0
3.4
Utilities
0.0
3.0
Country Allocation AS OF 12/31/19
Portfolio (%)
Developed
74.3
United States
46.7
Japan
11.6
United Kingdom
6.3
Germany
2.8
Australia
2.4
Hong Kong
1.5
Belgium
1.3
Other
1.9
Emerging & Frontier
25.0
India
13.4
Taiwan
4.6
Argentina
2.8
Thailand
2.4
South Korea
1.1
Mexico
0.8
46.6% United States
74.3% Developed
25.0% Em and Frontier

Country weights are calculated as a percentage of total portfolio including cash & cash equivalents.

Commentary & Literature

Commentary
Fact Sheet
News & Updates

Morningstar – A Perfect Fit: Ajay Krishnan Applies the Wasatch Process in India

September 24, 2019

Morningstar recently featured Ajay Krishnan and Wasatch Emerging India Fund in an…

Read More >

Wasatch Advisors Rebrands as Wasatch Global Investors

September 24, 2019

Salt Lake City, Utah, September 24, 2019—Independent investment manager Wasatch Advisors has…

Read More >

Important Disclosures

Portfolio Characteristics, Allocations and Top Ten Holdings are derived from a representative account.

Est. 5-year EPS Growth %: Estimated percentage increase in earnings per share (EPS) per year of the fund's holdings over the next 5 years. Returns are not guaranteed and may be higher or lower. Source: Wasatch and FactSet. P/E Ratio (forward and trailing): Sum of stock prices of the fund's holdings divided by the aggregate earnings per share of those holdings for the next 12 months (forward), or past 12 months (trailing), calculated as a weighted harmonic average. P/E to Growth Rate: Forward 12-month P/E ratio divided by the estimated 5-year EPS growth rate. Portfolios with a number less than 1.0 would be considered undervalued, around 1.0 would be considered fair valued and significantly greater than 1.0 would be considered overvalued. Weighted Average Market Cap: Average market capitalization of companies held by the fund, weighted by their percentage of fund net assets. Portfolio Turnover: A measure of trading activity in a fund's portfolio over the past 12 months expressed as a percentage of the fund's average total assets. Alpha measures a fund's risk/reward potential. A positive alpha means the fund outperformed the index. A negative alpha means the fund underperformed the index. Beta measures a fund's risk in relation to the market. A beta of 0.8 means the fund's total return is likely to move up or down 80% of the market change; 1.25 means total return is likely to move up or down 25% more than the market. R-Squared measures (from 0 to 1.0) how closely a fund's movements are correlated with movements of its benchmark. An R-squared of 1.0 would mean that the fund's movements are completely correlated with the movements of its benchmark. Active Share measures the difference between portfolio holdings and the benchmark. It is the sum of the absolute values of the different weightings of each holding in the fund versus each holding in the benchmark, divided by 2. Standard Deviation measures the degree to which a fund's performance has varied from its average performance over a particular time period. The greater the standard deviation, the greater a fund's volatility (risk). Upside Capture explains how well a fund performs in time periods where the benchmark's returns are greater than zero. Downside Capture explains how well a fund performs in time periods where the benchmark's returns are less than zero.

Portfolio holdings are subject to risks and may change at any time.

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