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Global Equity Extension Strategy

  • Asset Class Equities

Overview

The GMO Global Equity Extension Strategy seeks to deliver high risk‐adjusted returns by capturing both the positive and negative views of GMO’s proprietary alpha models, investing in both developed and emerging market equities. The Strategy aims to have a beta of 1, with benchmark-relative performance driven primarily from bottom‐up stock picking. Leverage in the Strategy will typically result in a gross exposure of approximately 160%: 130% long and 30% short.

The Strategy’s investment approach is grounded in the Global Equity team’s belief that, in the short term, equity markets exhibit exploitable inefficiencies as a result of irrational investor actions, the imperfect flow of information, and the participation of non-economic actors, while in the long term returns are ultimately driven by economic reality. The Strategy aims to take advantage of this inefficiency by utilizing a multi-factor valuation model in conjunction with other methods, such as cross-asset signals and corporate alerts, to identify mispriced equity securities.

Facts

Performance

Management

Constable_Neil

Neil Constable

Head of Global Equity

Dr. Constable is the head of GMO’s Global Equity team. Previously at GMO, he was the head of quantitative research and engaged in portfolio management for the Global Equity team’s quantitative products. Prior to joining GMO in 2006, he was a quantitative researcher for State Street Global Markets and a post-doctoral fellow at MIT. Dr. Constable earned his B.S. in Physics from the University of Calgary, his Master’s in Mathematics from Cambridge University, and his Ph.D. in Physics from McGill University.

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Risks

Risks associated with investing in the Strategy may include Equities Risks, Short Investment Exposure Risk, Risks of Non-U.S. Investments, Derivative Instruments Risks, and Currency Risks.