Jupiter US Smaller Companies (LON:JUS) is managed by Robert Siddles, who aims to generate long-term capital growth, while preserving capital in periods of stock market weakness, from a diversified portfolio of mid- and small-cap US equities. Since October 2017, the manager has employed a tighter investment process, increasing JUS’s portfolio concentration and enhancing the sell discipline. This has proved effective; since then, the trust has outperformed its US small-cap equity benchmark by more than 15pp. Relative performance has remained robust during recent months, which have been characterised by high levels of stock market volatility.
Investment strategy: Very disciplined approach
The manager undertakes stock selection in a very disciplined manner, which involves quantitative screening; a qualitative risk assessment, aiming to avoid ‘value traps’; and a ‘good company test’ (a strong franchise, meaningful free cash flow, a high level of insider ownership, potential pricing flexibility and at least 50% potential upside from its current share price). Very few companies pass this three-stage process and are deemed worthy of in-depth fundamental analysis, which includes the construction of a detailed financial model.
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