The Geneva-based asset management company QUAERO CAPITAL is launching Quaero Capital Funds (Lux) – Quaeronaut Small & Mid Cap, a new European equity sub-fund of its Luxembourg SICAV Quaero Capital Funds (Lux). The fund will be invested in European small and mid caps (including Switzerland and the UK), which have traditionally been one of the most dynamic segments of the European equity market. Based on the same “value” management philosophy that made the success of the flagship Argonaut fund, Quaeronaut offers access to slightly larger capitalizations than the micro-caps forming the Argonaut investment universe. The new fund will be managed by Adrian Bignell and Quaero Capital’s European management team.
European Small & Mid Caps: a buoyant segment
European small and mid caps are a particularly interesting market segment. Indeed, they have beaten large caps in every 10-year period since 1999, whether in the down years or up. Moreover, the time seems well chosen to invest in Europe, since the Old Continent should be supported in the years to come by several promising themes, whether it be the growing needs in terms of energy infrastructures, the relocation of production in order to reduce dependence on Asia, the increasing automation of industry or the sharp increase in security budgets.
A fund managed according to a “Quality Value” style
Entrusted to Adrian Bignell, management follows a “Quality Value” investment style, based on in-depth fundamental analysis and active management. Focused on Europe (including Switzerland and the United Kingdom), it focuses on small and medium-sized companies, with a market capitalization between EUR 1 and 10 billion. The result is a concentrated portfolio of some 40 to 50 positions, which are generally traded forward with a PE 10% to 20% lower than that of the MSCI Europe SMID Cap index. The fund falls under the Article 8 category of the SFDR regulations.
The management team considers ESG analysis to be an essential part of the investment process. She plans to invest the majority of the portfolio in companies that are already managed sustainably, with the rest invested in companies with the potential for improvement through her engagement. The team will actively encourage poorly rated companies to improve their communication on ESG issues, to further integrate these issues into their governance and strategy and to set clear objectives.
A very experienced European Small & Mid Cap team
Based in London, Adrian Bignell joined the QUAERO CAPITAL management team in European small and mid caps in 2021. With an average of 23 years of experience, the team manages several funds in this asset class, in particular the flagship fund Argonaut, which focuses exclusively on European micro-caps. Thanks to an intimate knowledge of the companies it follows, the team carries out its own fundamental analysis and original research, which translates into conviction-based management, oriented on the long term and without constraints in relation to benchmark indices. As its name suggests, the new Quaeronaut fund adopts the management philosophy that makes the success of the Argonaut strategy and thus allows investors to benefit from the talent and experience of its management team.
“This new active and concentrated strategy fits perfectly with our specialized management philosophy ‘away from the crowds’. Despite or perhaps thanks to the current economic and geopolitical uncertainties, the moment seems particularly favorable to us. Indeed, not only are there currently many opportunities to be seized, but active management is regaining all its interest in an environment where interest rates have returned to positive territory and where we are once again able to make objective relative choices. . » declared Jean Keller, CEO of QUAERO CAPITAL.