About Small-capsOver the long run, the shares of smaller listed companies historically deliver a higher return than large-cap shares. The best of these smaller companies not only hold leading positions in niche markets, but also benefit from greater flexibility and management alignment. Moreover, they often have far less research coverage from investment analysts than large-caps, presenting real opportunities for the active investor.
We believe in the added value of active fund management. This certainly applies to small-caps. Investors who conduct their own research can profit from their greater expertise on this asset class. Moreover there are greater differences in quality in small-caps than in large caps; there is wider dispersion between high-quality and lower-quality companies. It is precisely for that reason that it is worth investing in small-caps via a fund that applies active equity selection rather than a passive fund (index tracker).