Strategy Highlights

  • Pursuing an asymmetric return profile (low downside market capture), with active stock selection guided by themes, fundamentals and valuation
  • Disciplined approach seeks to ensure that every stock and the overall portfolio compounds at a higher yield than that of the market, and that dividends are underpinned by durable cash-flow streams
  • Investing in companies that positively manage the material impacts of their operations and products on the environment and society
  • Actively omitting companies involved in areas of high social cost, environmental degradation or violation of the UN Global Compact Principles

This strategy is offered by Newton Investment Management Ltd (‘NIM’). NIM is part of the Newton Investment Management Group.

Strategy Profile

Objective

The strategy seeks to outperform the MSCI World NDR Index by more than 2% per annum over rolling 5-year periods, by achieving income and capital growth from a global portfolio comprised of companies that typically yield at least 25% greater than the FTSE W World Index yield, and which demonstrate attractive investment attributes and sustainable business practices.

Performance benchmark

MSCI World NDR Index (total return), FTSE W World Index (yield criteria)

Typical number of equity holdings

70 or fewer

Sustainable investment restrictions

Strategies that follow the Newton sustainable investment process are subject to a set of minimum exclusions referred to as ‘sustainable investment restrictions’. These restrictions include companies involved in or that generate a material proportion of revenues from activities that are deemed to be harmful from an environmental or social perspective.

Strategy inception

July 18, 2019

Investment Team

Our Sustainable Global Equity Income strategy is managed by an experienced team. In-house research analysts are at the core of our investment process, and our multidimensional research platform spans fundamental, thematic, responsible investment, quantitative, geopolitical, investigative and private-market research to promote better-informed investment decisions.

Want to find out more?

Jon Bell
Jon Bell

Portfolio manager, Equity Income team

Robert Hay
Robert Hay

Portfolio manager, Equity Income team

James A Lydotes
James A Lydotes

Head of equity income and deputy chief investment officer, equity

Your capital may be at risk. The value of investments and the income from them can fall as well as rise and investors may not get back the original amount invested.

Newton will make investment decisions that are not based solely on ESG criteria. Other attributes of an investment may outweigh ESG analysis when making investment decisions. The way that ESG and sustainability criteria are assessed and the evaluation of their suitability for Newton’s sustainable strategies may vary depending on the asset class and strategy involved. For Newton’s sustainable strategies, ESG analysis is performed prior to investment for corporate investments (single name equity and fixed-income securities). The analysis will then also follow the Newton sustainable investment process to ensure it fits with the wider Newton sustainable investment philosophy.

Key Investment Risks

  • Objective/Performance Risk: There is no guarantee that the strategy will achieve its objectives.
  • Currency Risk: This strategy invests in international markets which means it is exposed to changes in currency rates which could affect the value of the strategy.
  • Derivatives Risk: Derivatives are highly sensitive to changes in the value of the asset from which their value is derived. A small movement in the value of the underlying asset can cause a large movement in the value of the derivative. This can increase the sizes of losses and gains, causing the value of your investment to fluctuate. When using derivatives, the strategy can lose significantly more than the amount it has invested in derivatives.
  • Emerging Markets Risk: Emerging Markets have additional risks due to less-developed market practices.
  • Concentration Risk: A fall in the value of a single investment may have a significant impact on the value of the strategy because it typically invests in a limited number of investments.
  • Sustainable Strategies Risk: The strategy follows a sustainable investment approach, which may cause it to perform differently than funds that have a similar objective but which do not integrate sustainable investment criteria when selecting securities.
  • Investment in Infrastructure Companies Risk: The value of investments in Infrastructure Companies may be negatively impacted by changes in the regulatory, economic or political environment in which they operate.
  • Counterparty Risk: The insolvency of any institutions providing services such as custody of assets or acting as a counterparty to derivatives or other contractual arrangements, may expose the strategy to financial loss.
  • High Yield Companies Risk: Companies with high-dividend rates are at a greater risk of not being able to meet these payments and are more sensitive to interest rate risk.