The Driehaus Emerging Markets team focuses on investing in emerging markets securities of all capitalizations, through the Driehaus Emerging Markets Growth, Driehaus Emerging Markets Opportunities and Driehaus Emerging Markets Small Cap Equity strategies. The strategies provide investors with exposure to companies experiencing growth inflections in addition to positive earnings revisions and medium-term (price) momentum, two factors that are positively correlated to alpha generation. The team is led by portfolio managers Howard Schwab, Chad Cleaver and Richard Thies.
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The strategy seeks to outperform the MSCI Emerging Markets Index over full market cycles.
The strategy aims to outperform MSCI Emerging Markets Small Cap Index.
The strategy seeks to provide superior risk-adjusted returns and higher total return than the MSCI Emerging Markets Index over a full market cycle.
The team employs a growth-oriented investment philosophy focusing on identifying company-specific growth inflection points and exploiting associated marketplace inefficiencies. Our philosophy hinges on a belief that market expectations tend to be ‘anchored’ to historical information and that points of inflection therefore introduce dislocations between market expectations and fundamentals which generate significant alpha capture opportunities. The team combines fundamental, macro and behavioral analysis with a nimble/active investment approach to quickly identify inefficiencies and generate a portfolio which uniquely seeks to achieve superior aggregate growth rates as well as superior risk characteristics.
Secular growth and work-from-home assets outperformed in 2020 as the world struggled with the initial onset of Covid-19. In the first quarter of 2021 cyclical and value assets rebounded as vaccines were rolled out and the world emerged from lockdown. That quickly led to myriad reports of inflation, with concerns amplified by the Fed’s stated willingness to let the economy run hot.
Global equity markets continued their ascent during the second quarter, as the pace of COVID vaccinations picked up, while global fiscal and monetary policy remained highly supportive. Interest rates reached a near-term peak at the end of the first quarter, as new variants of COVID, muted employment data, and peaks in certain commodity prices led market participants to question the reflation narrative that had been embraced over the previous six months.