Little followed by analysts and little known by investors, European small caps are undervalued, despite their superior growth prospects. And while the last two years have hardly been kind to them, now seems a particularly good time to enter this market.
Despite some optimism among market participants, the macroeconomic environment remains rather weak and growth is set to slow in 2024. The big question is whether this will be a soft landing or a harder one. Caution therefore seems to be the order of the day in the first half of the year, even if price falls will provide opportunities to add to positions.
While (almost) all equity markets benefited in 2023 from a major upward movement that often took them to record levels, the small end of the capitalisation spectrum suffered. In fact, European blue chips were up 16% in 2023, mid caps were up 10% and small caps were up 8%, while micro caps fell by 7%!
To celebrate the 20th anniversary of our Argonaut fund in style, we have put together a scrapbook album that sums up 20 years of adventures in the jungle of European microcaps, with a few key dates, facts and figures, anecdotes from company visits or trips, and some good and not-so-good memories.
In this interview on Proactive, Philip Best and Marc Saint John Webb tell us all about the Argonaut fund, on the occasion of its 20th anniversary.
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Small caps are virtually unavoidable in a diversified equity strategy as they now represent just over 11% of global market capitalisation (see chart below).
MSCI World AC: Small caps weighting in the index
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This content is available only to some investor categories and no profile has yet been defined. Define your investor profile to access this content.
QUAERO CAPITAL is celebrating the 20th anniversary of its flagship fund Quaero Capital Funds (Lux) – Argonaut, which invests in European micro caps (including Switzerland and the UK). Managed on a pure value basis by Philip Best and Marc Saint John Webb, Argonaut has generated since its launch at the end of May 2003, a cumulative performance of +740.7% compared to +514.9% for the EMIX Smaller European Companies Index NR EUR[1]. While it has been soft closed to new investors for a long time, Argonaut is temporarily opening its doors for a limited period and for limited amounts.