MFS Investment Management announced the launch of MFS Meridian Funds – U.S. Equity Opportunities Fund. The fund is a concentrated, high-conviction US multi-cap equity strategy that utilises a disciplined, bottom-up stock selection and portfolio construction process that combines MFS’ fundamental and quantitative research.
The fund is an extension of an existing MFS strategy available through its US mutual funds since 2000. Managed by Matthew Krummell, CFA, it seeks to generate long-term risk-adjusted performance over a full market cycle of three to five years.
“We believe this style of equity investing offers a differentiated approach that can help meet the needs of investors seeking the right balance between risk and return,” said Lina Medeiros, president of MFS International Ltd. “The fund leverages two distinct approaches to security selection through the continuous assessment of fundamental and quantitative research. The strength of this design places clients at the heart of an investment process that has the potential to generate strong risk-adjusted returns in various market cycles”, she added.
The portfolio manager, in conjunction with MFS’ deep team of research analysts, routinely reviews position size and evaluates securities for inclusion in the portfolio. MFS’ blended research approach is widely used across multiple strategies at the firm and also used in investment strategies with more than $13.6 billion in assets under management.
Commenting on the launch, Matt Krummell said, ‘In our view, fundamental and quantitative research are complementary, the inherent strengths of one type of research generally offset the inherent weaknesses of the other. The combination of two independent stock selection processes in this portfolio means that we leverage only our best ideas for the benefit of our clients’.
The fund follows a disciplined, systematic approach to portfolio construction. It combines two independent stock selection processes. When a stock is simultaneously rated with both a quantitative and fundamental ‘buy’ recommendation, it is considered for the fund. We believe these are stocks of high-quality companies, trading at attractive valuations, and have a growth catalyst. Typically the fund may invest in 40 to 50 stocks. Holdings are primarily eliminated from the portfolio upon being downgraded to a ‘hold’ or a ‘sell’ by a fundamental analyst or the quantitative model.
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