The opportunity

International micro cap stocks are an underinvested and overlooked segment of the global share market and provide investors with an opportunity to generate outsized returns relative to larger capitalisation stocks. Like their US counterparts, international micro cap stocks exhibit favourable characteristics including a large, high quality and diverse universe of companies, little-to-no sell side coverage, few investment managers with a credible track record and process, and a valuable correlation benefit with respect to other segments of global equities markets. The investment universe targeted by THB also gives meaningful, direct exposure to some secular growth drivers not so prevalent in more traditional large and small cap portfolios.

About the manager

THB Asset Management (THB), an investment franchise of Victory Capital Management Inc., is a dedicated micro and small cap specialist investment franchise based in Connecticut, USA. Founded in 1982, THB has 39 years’ experience investing in US micro cap stocks and has one of the longest and most distinguished track records in US and international (ex- USA) micro cap markets.

THB is a signatory of the UNPRI and the Montréal Carbon Pledge, and a Registered Investment Advisor with the US Securities and Exchange Commission2.

About the strategy

THB has an active approach which utilises both qualitative and quantitative disciplines to construct a portfolio of companies with valuation metrics similar to or lower than the broader market of securities into which it invests, yet with superior long term characteristics. THB’s style is best described as core, and has elements of both growth and value.

The THB International (ex-USA) Micro Cap Fund is well diversified, holding between 130 – 160 stocks across 22 of the 23 developed markets (ex-USA) and maintains broad country, economic, sector and stock diversification.

1. Returns in AUD as at 30 September 2023 on a net, pre-tax basis and assume the reinvestment of distributions. Past performance is not an indicator of future performance. Fund inception date was 23 August 2018 however inception performance for this class is calculated from 7 September 2018. Return to the reference

2. Victory Capital Management Inc. (Victory) holds an AFSL (528472) in respect of the financial services it provides to Wholesale Clients and is not licensed to provide financial services to retail clients in Australia. Victory is regulated by the Securities and Exchange Commission of the United States of America (US) under US laws, which differ from Australian laws. Return to the reference