Page 26 - Investment Advisor July/August 2022

2022 Asset Manager of the Year

Sustainable & Overall Asset Manager of the Year

Schroders
Hartford-Schroders International Stock Fund

t’s been a couple of good years for
ISchroders portfolio managers Simon
Webber and James Gautrey. In 2021,
the duo won the Envestnet/Investment
Advisor award in the Global, International
category. In 2022, they won for their
Hartford Schroders International Stock
fund in the Sustainable Category and
took home the big trophy, Asset Manager
of the Year, beating out nine other man-
agement teams.
Gautrey and Webber, who have been
co-managing the International Stock
Fund since 2014, returned 11.4% in James Gautrey Simon Webber
2021, outpacing the benchmark by 3.6%. Title: Manager Title: Manager
Further, they’ve averaged 13% over the
past five years, according to Envestnet Years with firm: 20 Years with firm: 22
analysts, who describe the fund as a Years in financial services: 20 Years in financial services: 22
“large cap international core equity
strategy with a growth tilt and a quality
bias that consists of 50-70 stocks with Investment/Asset Class Focus: “[In 2021] people were beginning to
dynamic exposure to emerging markets.” Sustainable Investing worry about … inflation returning, tight-
Further, the team “attempts to exploit Asset management firm: Schroders er monetary policy leading to higher real
pricing inefficiencies that are created by interest rates and what that meant for
the ‘growth gap.’ This is when the market Year firm founded: 1804 valuation, and particularly the shape of
either underestimates the future growth Number of employees: Over 5,500 the market with respect to value verses
of a company based on short-term think- AUM as of March 31, 2022: growth,” Gautrey explained. “Also, you
ing … or fails to recognize catalysts that Schroders: $991 billion, Hartford saw a real schizophrenia … probably
may alter the growth trajectory of a Funds: $148 billion up to November, where you saw fits of
business,” according to Envestnet. value performance for a month followed
ESG is integrated into their process, by a vicious swing back into growth as
Webber said, noting they don’t exclude sectors, such as energy. the market didn’t know what was going to happen.
“[Some thought] the fossil fuel sector was un-investable, but “We tried to maintain a balance in the funds as much as we
actually, there is a critical transition to be made towards less could, and didn’t make too big a bet one way or another on
emission in terms of energy sources. And those companies can what the outcome of inflation or real rates was going to be.”
have a significant role to play in the transition and in building the Sixty to 70% of the portfolio, the “core,” are high quality,
new energy infrastructure,” Webber said. structural growth companies that generally do well. Noted
Energy was one area where they saw an “opportunistic Gautrey: “we pay a reasonable price for them over the long
growth gap” as the sector recovered. This growth gap takes period of time.” The rest are opportunistic stocks.
advantage of when the market overreacts in the short term, Webber said that two core stocks that did well for them
Gautrey explained. “Markets are uncomfortable thinking in six last year were Lindt, the chocolatier, and Diageo, the spirits
to 12 months. … People look at the last data point and assume producer, which both recovered in 2021 from pandemic tight-
that it is the new direction forever. And share prices tend to ening by consumers. However, Schroders sold SEA, an e-com-
overreact dramatically.” merce company, in which growth had been “turbocharged”
They focus on balance sheet strength and “look through the by the pandemic. “[SEA] decided to expand into a lot of new
valley to the other side,” he said This typically is in the oppor- markets. … We developed a more negative growth gap and sold
tunistic trades, but could be in core as well. out of the positions,” he explained. — Ginger Szala

24 INVESTMENT ADVISOR JULY/AUGUST 2022 | ThinkAdvisor.com