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New to mFund: Fairlight Global Small & Mid Cap Fund (ASX: FLI01) and Fairlight Global Small & Mid Cap Fund – Hedged (ASX: FLI02) now available

New to mFund
27 January 2021

Invest in this fund via mFund code: FLI01 and FLI02

Fund overview

The Fairlight Global Small & Mid Cap Fund employs a concentrated, long only strategy, investing exclusively in international markets. Its investment philosophy is grounded in fundamental research, long term in nature and has a strong focus on quality. The fund aims to deliver investors an 10% - 12% return through the market cycle with lower volatility than the index. It has been the experience of the Fairlight team that a portfolio of the highest quality businesses, purchased with valuation discipline will outperform over the long term whilst protecting and preserving client capital.

Investment Philosophy

Fairlight’s investment process is designed to find businesses that have a demonstrable track record of earning outsized returns on capital with characteristics that will allow these returns to persist into the future, available at attractive valuations. Where possible, the strategy mitigates potential risk by looking for stable and aligned management teams, conservative balance sheets and avoiding single points of failure. The portfolio is segmented into three types of investment opportunities: 

  • High quality growth companies 
  • Stable compounders 
  • Low risk turnarounds 

Fairlight does not invest in sectors of the market that do not meet its quality criteria including cyclical business (commodities and mining) and interest rate sensitive businesses (banks and utilities).

Why Invest in Global Small and Mid Caps?

Fairlight believes that the Global SMID segment is an attractive investment opportunity based on the following tenets:

  • Historical data consistently indicates that smaller companies outperform larger companies over the long term. 
  • Quality companies provide more reliable earnings growth over the long term whilst protecting investor capital. 
  • Global investing provides a much larger, higher quality opportunity set available at more reasonable valuations when compared to local alternatives. 
  • The Fund is concentrated to provide investors with a truly active portfolio that behaves differently to the market whilst still capturing similar diversification benefits to the market. 
  • Market inefficiencies and mispriced securities are more common amongst smaller companies.

About Fairlight

Fairlight Asset Management is an employee-owned boutique firm investing exclusively in global equity markets. Fairlight is focused on contributing to superior investment outcomes to their clients through exceptional performance. The team takes an ethically-aware, quality-driven approach to investing, dedicated to deep fundamental research of both the quantitative and qualitative aspects of investee companies.

For more information on the Fund please refer to the Investor Handbook