Investment Mangement

Commander Sustainable Global Equity

CommanderAM is preparing to launch its flagship global equity fund.

Investment Objective

The Fund seeks to outperform a global equity market benchmark after charges, over a rolling 5 year period, through actively investing across industry sectors in the publicly listed equity shares of 100 companies, that are best placed to deliver positive socially responsible outcomes across four sustainability themes, whilst also being highly resilient to financially-material sustainability risks (“financial materiality”) and by striving to ensure their operations do no significant harm to society and the environment (“impact materiality”).

Selection Criteria

Eligible firms must demonstrate:

Economic and/or operational alignment to positive socially responsible outcomes across four sustainability themes – Climate Change, Natural Capital, Basic Needs, Empowerment, and
High resilience to financially-material sustainability risks and striving to ensure their operations do no significant harm ‘DNSH’ to society and the environment, and
Their publicly listed stocks exceed specific investability thresholds (liquidity / costs of trading).

Portfolio Allocation

The 100 stocks selected from the eligible universe seek to align the portfolio with the benchmark’s regional / sector allocations. These allocations are refreshed annually.

The stocks within each of the regional/sector buckets are selected for the portfolio purely by ranking firms with the strongest ESG metrics according to the most relevant absolute and sector-specific key issues, using external ESG research (from MSCI).

Each of the 100 stocks in the portfolio is broadly equal weighted, rather than based on a stock's market capitalisation within the index.

Investment Process

The investment process is rules-based, repeatable and transparent.

A disciplined process systematically reassesess the proportion held in equity for each of the 100 companies to reflect the perceived strength or weakness in the rotational cycle of that company's share price. Entering periods of perceived weakness, cash tranches aim to provide an element of downside protection relative to the underlying equity: reinvesting that company's cash component on entering periods of perceived strength aims to increase the number of shares held within the equity component over the rotational cycle, driving compound growth.

Stewardship

If any portfolio stock ceases to meet the eligibility and investability criteria, it is replaced promptly.

Commander reinforces positive ESG accountability and best practice corporate governance across all 100 stocks e.g. by working with a proxy to implement a transparent set of scrupulous voting guidelines.

Sub Advisory

For professional clients requiring a tailored portfolio or a white-label solution, we provide access to our systematic strategy via sub-advisory mandates.

This rules-based approach can be applied to any diversified tradeable bundles of stocks:

Global, regional (UK, US, Europe, Japan, Asia, Emerging Markets) and/or
Thematic e.g. ESG, megatrends, beliefs

and has been implemented through all of CommanderAM’s strategies, notably our flagship global equity fund.