GLG European Leaders Long-Short
GLG European Leaders Long-Short is a bottom-up, long-short equity approach with a focus on liquid, medium to long term European opportunities with alpha shorts.
- The investment team is led by Sof Yiannakas who has over 13 years of experience investing in the European long-short equity space
- Geographic focus is on Europe which, in the investment team’s view, offers a highly liquid, diverse market of global and domestic companies, with fewer active market participants, creating opportunities for alpha generation
- The long side of the portfolio seeks to invests in companies that demonstrate the potential for long term growth, generate healthy operating margins and returns on capital, have strong leadership, and operate sustainably
- The short side of the portfolio targets stocks where the investment team believe the economic reality differs from the accounting representation and market perception
- Mid to large cap bias
- A high-conviction portfolio of c. 20-40 long positions and 30-60 short positions
Approach
The Strategy’s long investment philosophy is designed to identify ‘European Leaders’ – companies that the investment team believes demonstrate the potential for long term growth, generate healthy operating margins and returns on capital, have strong leadership, and operate sustainably. The philosophy is based on a bottom-up research process designed to understand the drivers, the direction, and the durability of six 'forces' that these ‘European Leaders’ typically exhibit.
The long philosophy is expressed in three strategies:
Compounding Leaders – Companies where the principal driver of returns are expected to be the sustainable long-term growth of earnings and free cash flow.
Emerging Leadership - Businesses which are on a “good to great journey”, often with an identified catalyst.
Value Leadership - Mispriced and/or misunderstood assets where the principal driver of returns, in addition to earnings growth, includes the potential for multiple expansion.
Conversely, the short side consists of single stocks where the investment team believe the objective view of economic reality materially differs from the current market perception. The investment team utilise a forensic audit process to identify single stock shorts which, in their view, ‘fail’ by demonstrating poor earnings quality, deteriorating fundamentals, and weaknesses in corporate governance. This process is supported by a dedicated analyst resource with expertise as financial auditor and forensic accountant at KPMG.
The investment process is repeatable, data intensive, and designed to encourage continuous process improvement. Data monitoring, a core tenant of the process, is utilised to measure the ‘pulse’ of a business and identify critical inflection points. The investment team utilises a propietary data platform designed in collaboration with Man Group data science and Man Group quantitative researchers to monitor portfolio investments. Idea generation is unconstrained and multi-dimensional, it relies on both stock specific screening, a deep understanding of business drivers and industries, as well as commercial awareness. Prospective investments undergo deep, bottom up due diligence by the investment team.
The portfolio is constructed by taking into account conviction, risk and complementarity to the rest of the portfolio. Undesired risk factors are constrained and often neutralised by long and short exposures.
| Approach | Long-short |
| Asset Class | Equities |
| Geographic Focus | Europe |
Manager(s)
Investment Solutions
Man offers a comprehensive suite of investment solutions and formats that can be tailored and optimised to meet specific client needs.
Our investment solutions offer optionality including: liquidity, control, investment restrictions, investor customisations and transparency.
UCITS
Alternative investment funds
US 40 ACT
Regional funds
Separate accounts
Advisory mandates
Managed accounts
Access to investment products and mandate solutions are subject applicable laws and regulations including selling restrictions and licensing requirements. Investment solutions listed above may not be compatible for all investment strategies and may be subject to minimum subscription requirements. Regional Funds: In additions to UCITS and AIFs registered across the EEA, a number of investment strategies are available in vehicles registered in Chile, Netherlands, Hong Kong, Japan, Singapore, South Korea and Switzerland.
Considerations
One should carefully consider the risks associated with investing, whether the strategy suits your investment requirements and whether you have sufficient resources to bear any losses which may result from an investment:
Investment Objective Risk - There is no guarantee that the Strategy will achieve its investment objective.
Market Risk - The Strategy is subject to normal market fluctuations and the risks associated with investing in international securities markets and therefore the value of your investment and the income from it may rise as well as fall and you may not get back the amount originally invested.
Counterparty Risk - The Strategy will be exposed to credit risk on counterparties with which it trades in relation to on-exchange traded instruments such as futures and options and where applicable, ‘over-the- counter’("OTC","non-exchange") transactions. OTC instruments may also be less liquid and are not afforded the same protections that may apply to participants trading instruments on an organised exchange.
Currency Risk - The value of investments designated in another currency may rise and fall due to exchange rate fluctuations. Adverse movements in currency exchange rates may result in a decrease in return and a loss of capital. It may not be possible or practicable to successfully hedge against the currency risk exposure in all circumstances.
Liquidity Risk - The Strategy may make investments or hold trading positions in markets that are volatile and which may become illiquid. Timely and cost efficient sale of trading positions can be impaired by decreased trading volume and/or increased price volatility..
Financial Derivatives - The Strategy will invest financial derivative instruments ("FDI") (instruments whose prices are dependent on one or more underlying asset) to achieve its investment objective. The use of FDI involves additional risks such as high sensitivity to price movements of the asset on which it is based. The extensive use of FDI may significantly multiply the gains or losses.
Leverage - The Strategy's use of FDI may result in increased leverage which may lead to significant losses.
Single Region/Country Risk - The Strategy is a specialist country-specific Strategy or focuses on a particular geographic region, the investment carries greater risk than a more internationally diversified portfolio.
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