Portfolio Construction Forum: SMID caps provide more opportunity gaps than large caps

Presented by James Rodda, Portfolio Manager, Antipodes Partners, at Portfolio Construction Forum Markets Summit 2025

There are two common myths when it comes to investing in global small- and mid-caps – that they have lower risk-adjusted returns and shouldn’t be a strategic asset allocation in portfolios and that they should be held in concentrated portfolios. But the low broker coverage and lack of research on SMID caps mean greater opportunity to exploit market mispricing relative to large caps.

To fully benefit from the opportunity gaps in global SMID caps, practitioners must understand the industries in which companies operate, including the winners and losers, how value is created, and whether changes are structural or cyclical.

 

 

11 March 2025