Sustainable Global Emerging Markets

Strategy Highlights

: Fundamental bottom-up research

Global thematic approach to investing targets areas with strong growth potential, not ‘old’ profit pools

Focus on ‘compounders’ – exceptional, leading businesses with long-term growth potential
: This strategy is offered by Newton Investment Management Ltd (‘NIM’). NIM is part of the Newton Investment Management Group.

Our Philosophy and Process

Harnessing Newton’s global analyst resources, and adhering to our investment framework focused on fundamentals, themes, valuations and ESG considerations.

Three overarching themes aligned with UN Sustainable Development Goals – Earth, health and wealth.

Our sustainable ‘red lines’ are built on a combination of exclusions that effectively avoid investments in security issuers involved in or that generate a material proportion of revenues from areas of activity that we deem to be harmful from a social and/or environmental perspective.

Focus on innovative companies and dynamic management teams that provide solutions and benefit from growth opportunities.

Every time we consider a security or look at an industry or country, it’s in the context of what’s happening across the world. We believe the investment landscape is shaped over the long term by some key trends, and we use a range of global investment themes to capture these.

Investment Team

Our Sustainable Global Emerging Markets strategy is managed by a team of two portfolio managers, who form part of Newton’s equity opportunities team. Our dedicated responsible investment team is an integral part of the investment process and has the power of veto. Guided by our global investment themes, the team seeks to identify opportunities and risks through research and debate.

16: years’ average investment experience
07: years’ average time at Newton

Paul Birchenough

Co-head emerging markets and Asia equities team
Alex Khosla

Portfolio manager, emerging markets and Asia equities team
Ian Smith

Co-head emerging markets and Asia equities team
Julianne McHugh

Head of sustainable equities
Zoe Kan

Portfolio manager, emerging markets and Asia equities team
Nick Pope

Portfolio manager, sustainable equity strategies
Fei Chen

Research analyst, emerging markets and Asia equities team
Aditya Shah

Research analyst, emerging markets and Asia equities team

Strategy Profile

Objective: To achieve long-term capital growth by investing in emerging-market securities that demonstrate attractive investment attributes and are deemed by Newton to be sustainable.
Performance benchmark: MSCI Emerging Markets Index (NDR)

Typical number of equity holdings: Typically 45-65 holdings

Strategy inception: December 2021

Your capital may be at risk. The value of investments and the income from them can fall as well as rise and investors may not get back the original amount invested.

Key Investment Risks

: Objective/Performance Risk: There is no guarantee that the strategy will achieve its objectives.

Currency Risk: This strategy invests in international markets which means it is exposed to changes in currency rates which could affect the value of the strategy.

Geographic Concentration Risk: The strategy may have substantial investment exposure to a single market which may have a significant impact on the value of the strategy.

Emerging Markets Risk: Emerging Markets have additional risks due to less-developed market practices.

Concentration Risk: A fall in the value of a single investment may have a significant impact on the value of the strategy because it typically invests in a limited number of investments.

Shanghai-Hong Kong Stock Connect and/or the Shenzhen-Hong Kong Stock Connect (‘Stock Connect’) Risk: The strategy may invest in China A shares through Stock Connect programs. These may be subject to regulatory changes and quota limitations. An operational constraint such as a suspension in trading could negatively affect the strategy’s ability to achieve its investment objective.

Counterparty Risk: The insolvency of any institutions providing services such as custody of assets or acting as a counterparty to derivatives or other contractual arrangements, may expose the strategy to financial loss.

Sustainable Strategies Risk: The strategy follows a sustainable investment approach, which may cause it to perform differently than strategies that have a similar objective but which do not integrate sustainable investment criteria when selecting securities. The strategy will not engage in stock lending activities and, therefore, may forego any additional returns that may be produced through such activities.

Derivatives Risk: Derivatives are highly sensitive to changes in the value of the asset from which their value is derived. A small movement in the value of the underlying asset can cause a large movement in the value of the derivative. This can increase the sizes of losses and gains, causing the value of your investment to fluctuate. When using derivatives, the strategy can lose significantly more than the amount it has invested in derivatives.