Smaller companies have underperformed in recent years as large-cap companies have recorded outsized returns. Despite this trend, we believe that there are several examples of smaller companies in Europe that possess the right mix of quality characteristics and growth drivers to potentially deliver substantial returns over the long run. At Comgest, we aim to build our portfolios with quality companies with enduring competitive advantages, irrespective of their size or market capitalisation.

At Comgest, we see the parallels between surfing and our own quality growth investment approach. Just as experienced surfers may wait hours before paddling out into the water and selecting a wave, we typically conduct years of fundamental research to determine whether a company meets our quality growth criteria. Liudmila Strakodonskaya, ESG Analyst, and Xing Xu, ESG Analyst / Portfolio Manager, detail how environmental, social and governance (ESG) factors fit into our research, investment selection and portfolio management process, spanning from India to the United States.

China’s late September stimulus measures took many investors by surprise. Misperceptions and fears have convinced many that China is no longer an investable market. Beyond the macroeconomic challenges and headlines, Comgest believes that China remains a great hunting ground for quality growth companies.

Financial metrics are crucial for evaluating a company’s value, but they don’t tell the whole story, writes ESG Analyst/Portfolio Manager Petra Daroczi. Human capital – the knowledge and skills people acquire throughout their lives – can be a significant competitive advantage, much like traditional capital expenditures on goods and services.

Europe’s largest companies are powering the MSCI Europe index, with market giants over €100bn contributing nearly 20% to returns. Despite challenges like inflation and geopolitical tensions, many have remained resilient. But what sets apart these companies from those that have hit their peak? Product Specialist Wolfgang Fickus dives into what makes these leaders stand out from the herd.

These days the world seems to be changing faster than ever. Rising geopolitical tensions and technological advancements, such as artificial intelligence, are increasing volatility in the global economy.