Mike: Hi, and thanks for joining us as we wrap up our conversation today with Alaina Anderson. Alaina is partner and the portfolio manager of the International Leaders Strategy at William Blair. And we’ve been talking about international investing. And as I just mentioned, she heads up the International Leaders Strategy. So, Alaina, could you tell us a little bit about how do you define and identify leaders, and really what that all means for investors? How do they benefit from that?
Alaina: Absolutely. Well, we discussed this notion of sustainable value creation in our conversations. At William Blair, leaders are, or are becoming, the best sustainable value creators in the world. They are those companies that are differentiated by the combination of their business models, their management teams, their highly desirable products and services, and their ability to generate, on a consistent basis, peer-leading returns. And it’s really the combination of these attributes that we expect to result in growth that is stronger for longer than the market anticipates. So that’s what leaders are.
How do we identify them? There’s really some quantitative and qualitative attributes that we’re looking for when we’re identifying leaders candidates in our eligibility list. From a quantitative perspective, we’re looking for those companies that are differentiated, versus their peers, by their revenue growth, by their incremental returns, and by their reinvestment rates because they generate those strong returns, and then they reinvest it in their business to continue to reinvent themselves and grow, again, stronger for longer than the market anticipates.
The qualitative aspects that we’re looking for are really around their competitive advantage. And so we look at their competitive advantages with an eye towards the competitive advantage strength, the competitive advantage health, and the competitive advantage period. And we believe by focusing on leaders in both these qualitative and quantitative aspects, we are able to create portfolios that over time generate superior risk-adjusted returns for our investors.
Mike: All right. We’ve been talking with Alaina Anderson. In this case, we’ve been talking to her about leaders. And she herself as a leader in fact of the portfolio of the International Leader Strategy at William Blair. Thanks for tuning in.
Alaina: Thank you.
Filmed April 2022
The views and opinions expressed herein are those of the speaker(s) as of the date of publication, are subject to change without notice as economic and market conditions dictate and may not reflect the views and opinions of other investment teams within William Blair. Factual information has been obtained from sources we believe to be reliable, but its accuracy, completeness, or interpretation cannot be guaranteed. This material may include estimates, outlooks, projections, and other forward-looking statements. Due to a variety of factors, actual events may differ significantly from those presented. This video has been provided for informational purposes only and should not be considered as investment advice or a recommendation of any particular strategy or investment product, or as an offer to buy or sell any securities or related financial instruments in any jurisdiction. Investment advice and recommendations can be provided only after careful consideration of an investor’s objectives, guidelines, and restrictions. Investing involves risks, including the possible loss of principal. Investing in foreign denominated and/or domiciled securities may involve heightened risk due to currency fluctuations, and economic and political risks. These risks may be enhanced in emerging and frontier markets. Investing in the bond market is subject to certain risks including market, interest rate, issuer, credit, and inflation risk. Rising interest rates generally cause bond prices to fall. High-yield, lower-rated, securities involve greater risk than higher-rated securities; portfolios that invest in them may be subject to greater levels of credit and liquidity risk than portfolios that do not. The inclusion of Environmental, Social and Governance (ESG) factors beyond traditional financial information in the analysis of securities could result in a strategy's performance deviating from other strategies or benchmarks, depending on whether such factors are in or out of favor. Diversification does not ensure against loss. Past performance is not indicative of future results.
Copyright © 2022 William Blair. “William Blair” refers to William Blair Investment Management, LLC. William Blair is a registered trademark of William Blair & Company, L.L.C.
