Emerging Markets Quantitative Equity

Investment Objective:

Emerging Markets Quantitative Equity seeks to outperform an emerging markets benchmark over the long-term through a disciplined, systematic investment process that employs a balanced stock selection model. We seek to add value through stock selection – rather than style or country selection – in a risk-controlled and cost-conscious framework, thereby producing an attractive return/risk profile from investing in emerging market equities.

The Invesco Edge:

  • With offices in the US, Germany and Japan, our globally integrated research team's breadth of expertise improves our return forecasting ability while also providing regionally unique market insights.
  • Stock return forecasts are made relative to other securities in the same sector by country. This sector-neutral approach produces fair comparisons and solves the problem of disparate practices and regulations across the emerging markets.
  • Systematic, disciplined process produces daily return forecasts for hundreds of stocks across a diverse emerging markets universe.
  • Stock selection process emphasizes stable return drivers, thereby reducing turnover and dramatically lowering transaction costs.
  • The strategy's core investment concepts have successfully added value in the US since 1984 and globally since 2001.

Investment Strategy:

Emerging Markets Quantitative Equity is designed to capture excess return through our proprietary multi-factor stock selection model. The model weighs four key investment concepts according to our assessment of their ability to forecast the expected return for each stock:

  • Earnings Momentum
  • Price Trend
  • Management Action
  • Relative Value

Forecasts are made relative to other securities in the same sector by country. This produces fair comparisons and solves the problem of many disparate practices and regulations across the emerging markets. Portfolios are structured to capitalize on stock selection, while minimizing the impact from other residual exposures such as country, sector, size and style (growth/value). Cost-effective trading is of paramount importance in the emerging markets. Incorporating rigorous cost management within our disciplined portfolio construction process helps us maintain the value added from stock selection.