Vontobel Fund II - Global Small & Mid-Cap Opportunities

Why invest in the Vontobel Fund II – Global Small & Mid-Cap Opportunities?

Global small- and mid-cap focus

The fund invests in small- and mid-cap companies globally, within the market capitalization range of the MSCI ACWI SMID Cap Index. The objective is to deliver attractive long-term capital growth and seek to outperform the reference index over a full market cycle.

Fundamentally appealing, overlooked opportunities

We believe global small- and mid-cap equities offer an attractive long-term opportunity. After an extended period of underperformance relative to large caps, valuations have reset to more compelling levels, while underlying fundamentals remain solid. On average, small- and mid-cap companies continue to demonstrate higher earnings growth and more conservative balance sheets than their large-cap counterparts.

The medium-term outlook is supported by a potentially more favorable macroeconomic environment, including easing interest-rate conditions, a recovery in M&A activity—where small- and mid-cap companies are often natural acquisition targets—and growing investor interest in diversifying equity exposure away from an increasingly concentrated large-cap universe.

This segment also tends to be under-researched, creating inefficiencies that we believe active management is well positioned to capitalize on.

“After years of underperformance, we believe small- & mid-caps are set for recovery, backed by their agility, innovative power, attractive valuations, earnings leverage, and improving macroeconomic backdrop. Our thematic lens seeks to uncover opportunities that may have been overlooked beyond large-cap dominated indices.”

A differentiated, forward-looking investment process

The investment team applies a thematic, research-driven approach that combines top-down identification of long-term structural growth themes with deep fundamental analysis of individual companies aligned with these tailwinds. Quantitative screening is complemented by qualitative assessment of business models, competitive positioning, and management quality.

The process is enhanced using advanced research tools, including AI, LLMs, and alternative data, as well as frequent engagement with company management. This disciplined and repeatable framework aims to identify future winners early and capture long-term compounding opportunities.

Diversification and asset allocation do not ensure a profit or protection against loss in declining markets.

Viewed through a thematic lens

Uncovering structural themes has become a pivotal part of active equity management. We use a dynamic framework detecting themes boosted by technological, demographic, and social megatrends. Our current thematic preferences are as follows.