Robeco, The Investments Engineers

Asia-Pacific Equities

Long-term value strategy with momentum awareness

Key points

  1. Focus on identifying value opportunities and avoiding over-hyped growth stocks

  2. High active share 80% or more with no neutral or under-weight stock positions 

  3. Long holding period and low portfolio turnover

Our approach

Market participants in Asia-Pacific tend to be short-term oriented, causing stocks to firmly over- or undershoot fair value. This offers plenty of opportunities to buy at underpriced levels and sell at extended levels. The investment team adheres to a contrarian investment approach and a long-term investment horizon. Our Asia-Pacific Equities strategy adopts a clear value style: though most investors invest in Asia for growth, historical return patterns of Asian portfolios confirm superior returns are generated by value styles.

  • Focusing on identifying value opportunities and avoiding overhyped growth stocks

  • Taking account of momentum by acknowledging the power of herd behavior

  • Adhering to a long-term horizon and avoiding short-term market distractions

The three steps of our stock selection:

Filter stocks

Filter stocks

First, multiple screening tools help to shrink the universe of about 2,400 stocks to a manageable level, filtering out the unattractive stocks.

Earmark opportunities

Earmark opportunities

Next, the investment team evaluates the remaining 400 stocks and earmarks the most interesting opportunities for further analysis.

360° assessment

360° assessment

In a third step, we assess stock attractiveness from all possible angles. On a monthly basis, approximately 10 new investment ideas undergo in-depth fundamental and valuation analysis, including the impact of material ESG factors on the business model and valuation assessment. Price momentum of the stocks in our universe can be very powerful. Investors' herd behavior often leads to the bidding up of stock prices far beyond fair value once a stock becomes a popular hold. Generally, we will start trimming the position once our target price is reached, but to benefit from price momentum, we will hold on to part of the exposure.

Team

The Hong Kong and Shanghai-based Asia-Pacific Equities team was founded in 2007. The team is made up of seasoned investment professionals with diverse cultural backgrounds to provide an East-meets-West investment approach. The team is embedded in Robeco's broader Global Fundamental Equities group of more than 60 investment professionals. There is frequent collaboration with the global thematic, sustainability and quantitative research specialists who support portfolio managers in designing, implementing and maintaining forecasting models and risk management tools.

Sub-strategies

This fundamentally managed strategy is available for developed markets or for an all-country universe.

A more concentrated version of about 35 to 50 stocks is also available. This portfolio has a clear value style. Though most investors invest in Asia for growth, historical return patterns of Asian style portfolios confirm superior returns are generated by value styles. The sustainable version of this strategy has both a lower ESG risk profile and significantly better environmental footprint than the reference index.

Discover our related funds below. Click on the dropdown menu to explore other related funds.

Sustainability

This strategy promotes, among other characteristics, environmental and/or social characteristics, which can include exclusionary screening, ESG integration, ESG risk monitoring and active ownership. It is classified as Article 8 under the EU Sustainable Finance Disclosure Regulation.

Our Asia-Pacific Equities strategy integrates ESG factors into its investment process by analyzing the impact of the financially material ones on a company’s competitive position and value drivers. We believe that this enhances our ability to understand long-term risks and opportunities of a company. If ESG risks and opportunities are significant, the analysis could impact a stock’s fair value and the portfolio allocation decision. In addition to ESG integration, the strategy applies an exclusion policy and benefits from voting and engagement activities focused on specific themes such as climate change, aiming to improve a company’s sustainability profile.

Ingredients

01

Rich heritage

This has been a core expertise for us for decades

02

Stability

Team has long-term experience and low turnover

03

Value tilt

Leaning towards stocks that are attractively priced relative to their fundamentals

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In all cases where historical performance is presented, please note that past performance is not a reliable indicator of future results and should not be relied upon as the basis for making an investment decision. Investors may not get back the amount originally invested. Neither Robeco Institutional Asset Management B.V. nor any of its affiliates guarantees the performance or the future returns of any investments. If the currency in which the past performance is displayed differs from the currency of the country in which you reside, then you should be aware that due to exchange rate fluctuations the performance shown may increase or decrease if converted into your local currency. Robeco Institutional Asset Management B.V. (“Robeco”) expressly prohibits any redistribution of the Information without the prior written consent of Robeco. The Information is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use is contrary to law, rule or regulation. Certain information contained in the Information includes calculations or figures that have been prepared internally and have not been audited or verified by a third party. Use of different methods for preparing, calculating or presenting information may lead to different results. Robeco Institutional Asset Management B.V. is authorised as a manager of UCITS and AIFs by the Netherlands Authority for the Financial Markets and subject to limited regulation in the UK by the Financial Conduct Authority. Details about the extent of our regulation by the Financial Conduct Authority are available from us on request.