Posted inEquitiesNORDICS

Norway hit by EM small cap fever

Six in 10 fund selectors attending the conference said they prefer small caps over large caps within emerging market equities, making Norway the only country where EM small caps are more popular than ones with a higher market capitalisation. This a radical shift compared to a year ago, when EM large caps had double the amount of fans as smaller companies.

Preferences have shifted in the other direction for European equities. A year ago, more than half of the delegates in Oslo favoured European small caps over large caps, while none had a preference for large caps. As European small cap valuations have become demanding, preferences are now evenly split.

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The ball is in the fund selector half

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A Norwegian fund selector noted that returns had been almost exclusively driven by asset allocation over the past years, wondering whether the recent spike in volatility was a sign of a turning point. The fund managers presenting at the conference fully agreed, stressing this was not going to change anytime soon.

However, it is up to fund selectors to capitalise on this, said Francis Ellison, a European equity manager for Threadneedle. “If I’m wearing my European hat, I’m just doing one asset class. It is really up to you guys to make the decision how to build that into your portfolio.” 

Click here to see a slideshow of photos taken during Expert Investor Norway.

Platinum members can additionally view a full breakdown of the event voting data here.

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