Asset Management Awards for Excellence 2019 – Best Fund Provider – Us Small And Mid Cap Equity

Best Fund Provider Us Small And Mid Cap Equity


Legg Mason Global Asset Management

Best Fund Provider – Us Small And Mid Cap Equity

Lennie Lim

managing director and regional head, Asia, Legg Mason Global Asset Management

“Guided by a mission of Investing to Improve LivesTM, Legg Mason helps investors globally achieve better financial outcomes by expanding choice across investment strategies, vehicles, and investor access through independent investment managers with diverse expertise in equity, fixed income, alternative, and liquidity investments.

Legg Mason’s broad-range US equity capabilities are well recognised through the investment solutions of our investment affiliates: Brandywine Global, ClearBridge, QS Investors, and Royce.

In particular, we are honoured Royce is awarded the best fund provider for US small and mid-cap equity. As a pioneer in small-cap investing, with over 40 years of experience, depth of knowledge and focus, Royce’s investment capabilities today span across micro-cap, small-cap, and mid-cap strategies that use value, core or growth approaches. Our accolades are testament to our unparalleled focus in delivering the best outcomes for our clients.

In 2019, our pipeline includes more liquid alternative offerings and long/short strategies, co-investment opportunities, alternative credit, investments in real estate assets, and multi-asset offerings.”

Winners rationale

In a bid to gain additional alpha amid a late economic cycle, investors tend to shift from high beta names to small- and mid-caps — a trend that is particularly noticeable in developed markets such as the US. As US small-cap firms tend to be more domestically focused, they are often seen as less vulnerable to disruptions in global trade. Private banks in Asia jumped at the opportunity to capitalise on this trend in 2018, and Legg Mason, a notable and experienced player in the US small- and mid-cap equities space was, for many, the go-to solutions provider.

The firm’s flagship fund within this sector — the Legg Mason Royce US Small Cap Opportunity Fund — is a bottom-up, actively managed thematic equity strategy that adopts an opportunistic approach focusing on turnarounds that possess a catalyst for change. The fund received abundant praise from the region’s private banks, with many acknowledging its distinguished performance track record. Since its inception in 2002, the strategy has outperformed both its benchmark, the Russell 2000 Index, and the Morningstar US small-cap equity category average.

The success of the fund is attributable to its investment affiliate, Royce & Associates’ 40-plus years of small-cap and micro-cap investing, as well as its well-diversified portfolio approach. The fund holds 245-320 stocks, helping to mitigate inherently high stock-specific and liquidity risks. It also maintains a disciplined value approach and typically focuses on undervalued equities with low price-to-book and price-sales ratios.

Bolstered by a strong distribution presence in Hong Kong and Singapore — made possible by a collaborative team of sales, client service, and marketing professionals — Legg Mason is fully committed to providing best-in-class investment solutions to its private bank partners. By working closely with its regional distribution partners, Legg Mason has been able to fill platform product gaps with leading, time-tested investment solutions.

Legg Mason is Asian Private Banker’s Best Fund Provider – US Small and Mid Cap Equity for 2019.

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