This strategy is offered by Newton Investment Management Ltd (‘NIM’). This strategy may be managed by an affiliate of NIM and may apply a research process that differs from that applied by NIM.

Strategy overview

Technology is at the epicentre of nearly all themes, regardless of sector, industry or geography. Robotics, artificial intelligence (AI), future mobility, and factory automation are just a few of the many investment themes that exist owing to the emergence of technology and, more importantly, device connectivity also known as the internet of things (IoT). Without the IoT, recent advancements including machine learning, data centres, sensing and communicating robots, autonomous vehicles, rain and soil sensors, smart thermostats and doorbells, and millions of connected devices around the world would not exist. In this context, the IoT is at the centre of almost all themes and technological innovation, creating and enabling a connected, efficient, faster, safer and better world. The IoT is also the foundation of the infrastructure that enables ‘Remote Life’. Owing to its fundamental and enabling support for so many other themes, the IoT is sometimes referred to as a ‘theme of themes’.

We follow a disciplined investment process that leverages the fundamental analysis of our global research team and the quantitative rankings of our alpha models. Fundamental research enables us to focus on individual securities that are modelled and analysed for two years or more. Included in this analysis is significant work on non-quantitative attributes, such as management plans, execution, and product, intellectual property (IP), or business model uniqueness. Complementary to this, our experience in quantitative research and risk management allows us to seek to optimise idiosyncratic risk and return at the portfolio level. This blend of quantitative and fundamental analysis maximises the strengths of both disciplines. Furthermore, we seek to harness broad transformational trends across seven core ideas: consume, move, heal, build, secure, renew and connect. This platform approach to thematic classification provides us with compelling and dynamic universes with maximum beta to the above trends to support the portfolio stock selection process.

Strategy profile

Objective

The strategy seeks to generate returns through a concentrated equity portfolio that benefits from investment opportunities in the IoT space.

Benchmark

Internet of Things custom index, comprised of the GICS sub-industries of the mid and small-cap stocks of developed-market countries that are identified to have an Internet of Things focus.

Strategy inception

1 May 2017

Investment team

Our investment team of research analysts and portfolio managers work together across regions and sectors, helping to ensure that our investment process is highly flexible.

Want to find out more?

Robert C Zeuthen
Robert C Zeuthen

Head of secular pod, portfolio manager

Shivam Kollur
Shivam Kollur

Research analyst, Equity Research team

Shawn Zhang
Shawn Zhang

Senior research analyst, Quantitative Research team

Stephanie Brandaleone
Stephanie Brandaleone

Research analyst, Quantitative Research team

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Past performance is not a guide to future performance. 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.

Analysis of themes may vary depending on the type of security, investment rationale and investment strategy. Newton will make investment decisions that are not based on themes and may conclude that other attributes of an investment outweigh the thematic structure the security has been assigned to.

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.
  • Emerging markets risk: Emerging markets have additional risks due to less developed market practices.
  • Market capitalisation risk: Investing in small companies may be riskier and less liquid (i.e. harder to sell) than large companies. This means that their share prices may have greater fluctuations.
  • 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.