“We have very strong competence in fundamental equity management and want to broaden our offering, making it possible for our customers to benefit from this in a context where the investment area is global, without any limitation when it comes to region or sector,” says Andreas Wollheim, Head of Fundamental Equity Management at SEB IM.
The basis of fundamental management is an in-depth analysis of companies based on fundamental factors such as competitiveness, profitability, profit development and growth prospects. In other words, the focus is on the potential of individual companies, while it in other types of management can be on, for example, major macroeconomic trends. Put simply, fundamental equity management is about "stock picking".
A concentrated portfolio creates better conditions for monitoring the companies
SEB Global Focus Fund invests globally, both in mature and emerging markets. Initially, the fund consists of around 50 companies – and the intention is to maintain a concentrated portfolio so that the holdings can be closely monitored. The fund’s managers focus on finding reasonably valued companies with quality aspects such as strong market position, high and sustainable profitability, clear sustainability work and a proven ability for profitable growth.
“We consider these to be crucial aspects of a company's ability to be successful. We have previously applied similar models in our regional funds with good results. The advantage of this fund is that we can not only choose from the best in the industry in a certain geographic region but rather from the entire world,” says Johan Söderström, who manages the fund together with Alexander Winberg and the Global Fundamental Equity Management team.
In addition to using the companies’ reported data, the managers will meet the companies they are interested in, to better analyse their prospects.
“We see great value in having direct dialogues with the companies and we already meet with some 300 companies yearly. There is much that does not appear in the facts and figures, but that can still be of great importance for the companies’ ability to grow and maintain or improve profitability. Given that SEB Global Focus Fund is relatively concentrated, even though it invests globally, we are able to follow the companies closely and quickly address details that can take the company in a new direction,” says Alexander Winberg.
Quality companies in focus
The fact that SEB Global Focus Fund focuses on fewer companies than a traditional global fund means that it can deviate relatively much from its benchmark index. Both the return potential and risk level are therefore somewhat higher. The fund is classified as risk level (SRI) 4 on a seven-point scale.
“We see an advantage in that the framework set for the fund allows us to be so niche. It creates good conditions for building the exact portfolio we want. Given that the companies meeting the criteria we are looking for are largely found in the technology and healthcare sectors, a natural risk spread arises through the different characteristics of the sectors,” Johan Söderström says.
“A couple of examples of companies that we like right now are Novo Nordisk and Schneider. The healthcare company, Novo Nordisk, has a strong demand for its products due to an aging world population and increasingly common welfare diseases. Schneider is another interesting company that benefits from the green transition by supplying infrastructure and software to make electricity use more efficient,” says Alexander Winberg.
SEB Global Focus Fund's managers have previously also taken over the management of SEB Aktiesparfond, SEB Teknologifond and SEB Artificial Intelligence Fund – a trio of funds that have since outperformed their benchmarks.
“We have a very strong team with expertise in many areas – not least in healthcare, pharmaceuticals and technology. These are also sectors that fit well with our investment philosophy, striving to invest in quality companies, and it's great that we can now utilise our expertise on a broad global level, as well”, says Andreas Wollheim.
SEB Global Focus Fund is classified as Article 8, or light green, according to the EU regulation SFDR (Sustainable Finance Disclosure Regulation), which means that it promotes sustainable properties.
Learn more about the fund in our fund list (in Swedish, seb.se)