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Provided by FIAM LLC, a registered investment adviser.
FIAM STRATEGIES
FIAM Small Cap Growth
The Small Cap Growth strategy seeks to outperform the Russell 2000 Growth Index over a full market cycle.
Investment Approach
The strategy uses a fundamental research intensive process designed to leverage the breadth and depth of our entire research platform. It seeks to build a balanced portfolio of companies with a positive inflection in organic growth or with a sustainable growth model that can consistently generate profit growth above market expectations.
Proprietary research advantage
Leveraging a foundation of rigorous fundamental research to seek alpha.
Active management
Growth portfolio that invests actively within the small cap universe.
Balanced portfolio construction
Comprehensive portfolio construction designed to exploit our strengths in both research and risk management.
Investment Process
Universe
Large diverse universe offers opportunity.
Companies we consider:
- Approximately 3,000 companies
- Market cap < $5B
- Traded on U.S. exchanges
How we evaluate the universe:
- Broad coverage
- Multiple layers of fundamental expertise
Idea Generation
Invest where results are favorable and asymmetric.
Uncover opportunities:
- Regular meetings with FIAM small cap analysts
- Engage with Fidelity research platform—broad coverage yields potential small cap ideas
Narrow opportunity set:
- Evaluate research ideas to understand if appropriate for portfolio
- Further refine analysis to identify inflections in growth and/or sustainable growth models to develop a thesis for potential outperformance
Portfolio Construction
Constantly assess path to target price realization. Capitalize on short-term dislocations. Changes in valuations trigger review of thesis.
Goals:
- Minimize non-stock risk in the portfolio
- Harness overall risk in a purposeful way
Considerations:
- Industry positioning
- Factor exposures
- Thesis creep
Small Cap Growth Portfolio
- 75–150 holdings
- Long-term orientation
- Performance driven by stock selection
Key Facts
| Inception Date | April 30, 2015 |
| Benchmark | Russell 2000 Growth |
| Separate account minimum |
$50M |
| Typical tracking error* |
3%–5%3%–5% |
| Sector constraint |
+/- 5.0% |
| Security constraint | +/- 4.0% |
| Typical portfolio turnover | 50%–90% |
Portfolio Managers
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* Risk metrics shown are provided for illustrative purposes. Risk metrics are not intended to represent performance of the strategy. They are presented gross of any fees and expenses that would apply to an investment in the strategy. Historical risk metrics do not necessarily guarantee the future risk profile of the strategy. Please see the performance section of the fact sheet for net composite performance which includes accounts managed by FIAM and other affiliated advisers, as permitted.
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