Fayez Sarofim & Co. Global Equity ADR Strategy
Why Invest in this Strategy?
- Seeks to provide quality growth exposure with lower volatility and less risk than the MSCI World Index benchmark. Seeks to invest in enduring companies that the managers believe are resilient, well-positioned, and whose earnings can potentially deliver solid growth over the long term
- Designed to be part of a core global holding, with long-term focus and low portfolio turnover
- Seeks to provide exposure to companies with dominant global positions in structurally attractive industries with clear competitive advantages
- Diversified portfolio investing in both U.S. and non-U.S. stocks
Strategy Assets
(Millions)
PE RATIO
(1-YEAR FORWARD)
PB RATIO
(1-YEAR FORWARD)
Return on
Equity (ROE)
Median
Market Cap
(billions)
Weighted AVG.
Market Cap
(billions)
EPS Growth
(5-Years)
Strategy Assets captures all assets the investment manager manages in that discipline for all client types.
Price/Earnings Ratio - Price-to-earnings (P/E) is the ratio of the market price of a firm’s common stock to its current (or predicted) earnings per share. Price/Book Ratio - Price-to-book value (P/B) is a ratio used to compare a stock's market value with its book value. It is calculated by dividing the current closing price of the stock by the latest quarter’s book value (assets minus liabilities).
Price/Book Ratio - Price-to-book value (P/B) is a ratio used to compare a stock's market value with its book value. It is calculated by dividing the current closing price of the stock by the latest quarter’s book value (assets minus liabilities).
Return on Equity is the percentage a company earns on its total equity for the time period listed. The calculation is net income divided by end-of-year net worth. The resulting figure is multiplied by 100.
Median Market Cap is the midpoint of market capitalization (market price multiplied by the number of shares outstanding) of the stocks in a portfolio. Half the stocks in the portfolio will have higher market capitalizations; half will have lower.
Weighted Avg Market Cap - Weighted average market cap is the average market capitalization of corporations in a fund or index, weighted by the percentage of the holding in the fund or index.
Earnings per share (EPS) growth is a figure that represents the annualized rate of net-income-per-share growth over the trailing five-year period for the stocks held by a portfolio.
Fayez Sarofim & Co.
Fayez Sarofim & Co. was founded in 1958 to provide investment counseling services and has remained focused exclusively on this one business. The firm is privately held and based in Houston, Texas. Fayez Sarofim & Co. has benefited from the tenure of its senior investment professionals, who have been with the firm an average of 21 years. The firm’s extensive client list and many long-term client relationships attest to its singular focus for over five decades. At the end of the fourth quarter of 2021, Fayez Sarofim & Co. managed approximately $29.4 billion in assets.
Investment Philosophy
Broad Industry Analysis
The portfolio management team is singularly focused on global investing with a deep and experienced research staff.
Deep Investment Research
Fayez Sarofim & Co. then identifies potential attractive companies, and then examines its valuations. The considered investment company is subject to ongoing research to validate or overturn Fayez’s thesis.
Stock Selection and Portfolio Management
The firm’s investment committee synthesizes the results and decides if the stock should enter the portfolio. The net result of the firm’s process is a portfolio with an average of 40–60 holdings.
Portfolio Managers
-
Alan R. Christensen, CFA
Years at the firm: 18
Years managing strategy: 3
Years in industry: 28
-
Catherine Crain, CFA
Years at the firm: 30
Years managing strategy: 23
Years in industry: 34
-
Gentry Lee, CFA
Years at the firm: 25
Years managing strategy: 13
Years in industry: 29
-
Christopher Sarofim
Years at the firm: 35
Years managing strategy: 26
Years in industry: 37
Performance
- Display Net data
- Display Gross data
- Monthly
- Quarterly
|
Annualized Returns
|
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|---|---|---|---|---|---|---|---|
| Inception Date | YTD | 1YR | 3YR | 5YR | 10YR | SINCE INCEPTION | |
| Fayez Sarofim & Co. Global Fund Composite | 07/15/93 | 1.89 | -8.20 | 9.62 | 7.76 | 7.62 | 6.87 |
| MSCI World Index | N/A | 4.50 | -7.33 | 9.90 | 6.88 | 8.77 | - |
|
Annualized Returns
|
|||||||
|---|---|---|---|---|---|---|---|
| Inception Date | YTD | 1YR | 3YR | 5YR | 10YR | SINCE INCEPTION | |
| Fayez Sarofim & Co. Global Fund Composite | 07/15/93 | -19.10 | -19.10 | 5.97 | 7.14 | 7.85 | 6.85 |
| MSCI World Index | N/A | 4.50 | -7.33 | 9.90 | 6.88 | 8.77 | |
Calendar Year Performance
- Display Net data
- Display Gross data
Composite Inception Date: January 1, 1994
Sources: Newton, BNYMSC and FactSet.
Past performance is no guarantee of future results. Current performance may be lower or higher than the performance quoted. No investment strategy or risk management technique can guarantee returns or eliminate risk in any market environment.
Performance information is based on the Composite.
Net returns assume the reinvestment of dividends, and are net of a 3.0% annual account advisory fee, which is the historical industry standard in the wrap account industry. Gross returns assume the reinvestment of dividends, but do not reflect the deduction of any account advisory fees or other expenses that an investor would pay, which would reduce returns.
The US Dynamic Large Cap Value Composite (“Institutional Composite”) is being shown as representative of the BNYM Newton Dynamic Value Strategy (“SMA Strategy”). The Institutional Composite is managed by the same investment team using a substantially similar investment process that is used for the SMA Strategy. The SMA Strategy is provided on a non-discretionary, model-only basis. Although BNY Mellon Securities Corporation, the SMA manager of record, believes that the Institutional Composite is representative of the SMA Strategy, there may be material differences between the Institutional Composite and the SMA Strategy. Net of fee performance is shown using a fee of 3%, which is the historical industry standard in the wrap account industry, as additional information. Please note that this figure may double count transaction expenses which are embedded in the Institutional Composite's gross of fees performance and the model 3% wrap fee.
The benchmark for the SMA Strategy and Institutional Composite is the Russell 1000® Value Index.
The Russell 1000® Value Index measures the performance of the large-cap value segment of the U.S. equity universe. It includes those Russell 1000 companies that are considered more value-oriented relative to the overall market as defined by Russell's leading style methodology. The Russell 1000® Value Index is constructed to provide a comprehensive and unbiased barometer for the large-cap value segment. The index is completely reconstituted annually to ensure new and growing equities are included and that the represented companies continue to reflect value characteristics. Investors cannot invest directly in any index.
Download Most Recent GIPS Performance Report for all GIPS Disclosures.
Portfolio
| Composition | Allocation |
|---|---|
| Microsoft Corporation | 7.00 |
| Apple Inc. | 5.00 |
| L'Oreal S.A.Unsponsored ADR | 4.50 |
| LVMH Moet Hennessy Louis Vuitton SE Unsponsored ADR | 4.50 |
| Chevron Corporation | 4.50 |
| Amazon.com, Inc. | 4.00 |
| Visa Inc. Class A | 3.50 |
| Alphabet Inc. Class C | 3.50 |
| Hess Corporation | 3.50 |
| Texas Instruments Incorporated | 3.00 |
Asset Allocation
Source: Fayez Sarofim & Co. Based on a representative model account and subject to change; actual individual accounts may vary.
Main Risks
All investments involve risk, including loss of principal. Equities are subject to market, market sector, market liquidity, issuer, and investment style risks to varying degrees. Small and midsized company stocks tend to be more volatile and less liquid than larger company stocks as these companies are less established and have more volatile earnings histories. Investing in foreign denominated and/or domiciled securities involves special risks, including changes in currency exchange rates, political, economic, and social instability, limited company information, differing auditing and legal standards, and less market liquidity. These risks generally are greater with emerging market countries. American Depositary Receipts (ADRs) do not eliminate the currency and economic risks for the underlying shares in another country. ADRs are subject to many of the same risks as the foreign securities to which they relate.
Risk Metrics
| As of 01/31/23 3-Year trailing | Standard Deviation | Alpha | Beta | R-Squared | Sharpe Ratio | Tracking Error | Information Ratio |
|---|---|---|---|---|---|---|---|
|
Fayez Sarofim & Co. Global Equity ADR Strategy
|
20.53 | 4.68 | 0.98 | 94.86 | 0.60 | 4.68 | 1.04 |
All risk metrics are provided by Morningstar. The index used in the calculations are determined by Morningstar which may not be the strategy’s primary benchmark. The index Morningstar used for this analysis is MSCI ACWI Index.
Investors should carefully review and consider potential risks before investing. Please see Main Risks section above for additional information regarding investment risks.
Separately Managed Accounts (SMAs) are offered by BNY Mellon Securities Corporation (BNYMSC) in its capacity as a registered investment adviser.
Fayez Sarofim & Co. is an SEC-registered investment adviser and a wholly owned subsidiary of The Sarofim Group, Inc. Sarofim, among other services, provides advisory services for equity portfolios under various agreements related to wrap-fee programs, and is introduced to wrap-fee program sponsors primarily through the efforts of BNY Mellon Securities Corporation under the terms of a solicitation agreement between Sarofim and BNY Mellon Securities Corporation. With respect to such wrap-fee programs, BNY Mellon Securities Corporation acts as the account administrator and serves as the liaison between Sarofim and the program sponsors and the program sponsors’ clients and receives in consequence a portion of the fee charged by the program sponsor for its account administration services. BNY Mellon Securities Corporation plays a similar role with respect to the unified managed account (UMA) programs for which Sarofim provides investment management or supervisory services. For such UMA programs, BNY Mellon Securities Corporation functions on behalf of Sarofim as the primary administrative contact with program sponsors and acts as account administrator, and receives in consequence a portion of the fee charged by the program sponsor for providing such services. Sarofim is not affiliated with BNY Mellon Securities Corporation or The Bank of New York Mellon Corporation. BNY Mellon Securities Corporation is a subsidiary of BNY Mellon. BNY Mellon is the corporate brand of The Bank of New York Mellon.
This information has been distributed for informational purposes only and should not be considered as investment advice or are commendation of any particular investment, strategy, investment manager or account arrangement and should not serve as a primary basis for investment decisions. Information displayed has been obtained from sources believed to be reliable, but not guaranteed. Please consult a legal, tax or financial professional to determine whether an investment product or service is appropriate for a particular situation. No part of this information may be reproduced in any form, or referred to in any other publication, without express written permission.
MARK-287605-2022-07-22
