Invesco Global Focus Equity Strategy

The objective of the strategy is to achieve long-term capital growth. The strategy invests at least 80% of its assets in shares of companies globally and typically holds a concentrated portfolio of 35-55 stocks. Derivatives (complex instruments) may be used to manage the strategy more efficiently, with the aim of reducing risk, reducing costs and/or generating additional capital or income.¹

Global Focus is a high conviction portfolio with a bottom-up approach to stock selection. We believe consistent, long-term outperformance can be achieved by investing within select long-term thematic trends, or tailwinds. Security selection involves discerning best undervalued ideas and taking potentially rewarded risks, as outlined below. Active portfolio management is a key tenet of Global Focus, a high active share portfolio of stocks with asymmetric return profiles.

Investing only where there is opportunity

• Use theme-based approach to identify companies that can compound value
• Research large dislocations for value opportunities

Know what matters

• Identify keys to the investment case for each opportunity
• Ignore short-term noise and transient news

Play to win

• Build portfolio independent of the index
• Concentrate in holdings with best risk/reward asymmetry

Within the global equity universe, the team identifies structural growth trends, or tailwinds, that will drive sustainable growth. The team targets attractively priced stocks of companies with durable business attributes and seek absolute value independent of style box parameters. In addition, we buy only when there is a significant gap between our estimate of the private market value of the business and the market price.

Rigorous fundamental company research drives stock selection. The team asks the following three questions, which must be answered in the affirmative to qualify for consideration, to focus the analysis, to give the team conviction in what they buy, and to help them avoid value traps:

1. Is the business worth owning…ever? Is the business exposed to a sustainable growth theme? What is the company's advantage and is it durable? Do the economics of the business improve with growth?
2. What’s the right price? If the business economics are sound, what you pay for a company is the single largest determinant of investment success or failure.
3. Is management working for shareholders? Allocating capital in an economically sensible way creates shareholder value, and our experience has been that past corporate actions by a management team are the best indicator of how they’ll behave in the future. 

The Invesco Global Focus strategy’s competitive advantages are the following:

Global equity investment leader

• The Invesco Global Equities Group (NY) (the Group) has been a pioneer in integrated global equity investing since 1969.
• The portfolio manager average tenure at the firm is 15 years.

Structural growth themes

• The Group identifies global structural, durable tailwinds that they believe drive sustainable growth.
• The Group avoids commoditised industries and business.

Long-term investing

• The Group conducts analysis with an investment horizon of 5-10 years and holds positions for an average of 8 years.

Bottom up stock selection

• The Group emphasises individual company fundamentals and focuses on microeconomics rather than macroeconomics.

High conviction management

• The portfolio is benchmark independent with an active share consistently near 90%.

Generalist approach to research

• The Group continuously aims to deepen understanding of companies across geographies, sectors and market caps to develop judgment through a holistic, global perspective.
• The Group mentors and develops analysts as generalists tom ensure Group continuity.

Randall Dishmon has been the portfolio manager of the Global Focus strategy since inception, September 28, 2007. He is supported by two dedicated research analysts, Jonathan Hartman and James Burke, as well as the additional members of the Global Equity Group.