Pear Tree PNC International Small Cap Fund
The Pear Tree PNC International Small Cap Fund has been subadvised by PNC Capital Advisors, LLC (“PCA”) since January 2019. The fund is modeled after the PCA International Growth Strategy which is run by the same portfolio manager, using the same process and philosophy since inception (1997). PCA is a member of the PNC Financial Services Group, Inc. and is headquartered in Baltimore, Maryland.
International Small Cap Fund employs an unconstrained equity selection process that is characterized by an active management approach. The investment process is a function of bottom-up growth security selection within a top-down country allocation framework. PCA believes that international investing is best suited by a combination of top-down and bottom-up analysis.
The investment strategy is built upon the premise that earnings growth drives stock prices over the long term. The process combines systematic, repeatable quantitative assessments of countries and securities with in-depth, bottom-up fundamental analysis and is designed around opportunistic stock selection with limited geographic and/or sector constraints. The bottom-up process identifies companies with robust and sustainable earnings growth rates, high-quality balance sheets, and strong management teams with a clearly defined growth strategy. The country allocation model utilizes market valuations, economic growth, risk and momentum data and serves as a guideline for country and regional weights. Fundamental review involves security level review and market level review and confirms the integration of the security selection and country allocation processes. The fund invests with a long-term investment horizon of three to five years to allow growth catalysts to materialize.
Portfolio construction seeks to combine the best security candidates within the recommended framework of country allocations. The fund will generally hold between 75 and 100 small capitalization equity securities domiciled in foreign markets. International Small Cap Fund considers a small-cap company to be a company having a market capitalization at the time of purchase between $50 million to $5 billion.
The Fund generally invests in stocks found within the MSCI ACWI ex USA Small Cap Index, which captures representation across 22 developed and 23 emerging market countries, and covers approximately 14% of the global equity opportunity set outside of the U.S.
- Foreign and Emerging Market Risk. Foreign markets, particularly emerging markets, can be more volatile than the U.S. market due to increased risks of adverse issuer, political, regulatory, market, or economic developments and can perform differently from the U.S. market. Emerging markets can be subject to greater social, economic, regulatory, and political uncertainties and can be extremely volatile.
- Pear Tree PanAgora Risk Parity Emerging Markets Fund is not available to residents in all states. Please call (800) 326-2151 for fund availability in your state or jurisdiction.