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GAM Sustainable Emerging Equity

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GAM Sustainable Emerging Equity is an actively managed, long-only strategy seeking alpha through a diversified portfolio of emerging and select frontier market equities. By blending bottom-up research with top-down analysis, the team targets quality companies at attractive valuations with the aim of capturing growth potential while seeking to limit downside risk. The strategy focuses on companies positively aligned to UN Sustainable Development Goals (SDG) contributing to a materially lower carbon intensity relative to the benchmark, with leading ESG ratings relative to their sector and excludes issuers with specific activities causing a negative environmental and/or social impact.

Our Edge

Experienced team testtesttest

With over 75 years of combined experience the team brings deep market insight and a refined process built to uncover opportunities through cycles.

A quantamental, holistic investment process

A consistent and repeatable process that combines proprietary quantitative models with deep fundamental research, integrating top-down and bottom-up insights in a high-conviction approach designed for the complexity of emerging markets.

Sustainability meets opportunity

The strategy targets structural themes such as digitalisation, energy transition and rising domestic demand, while embedding robust ESG integration to capture mispriced opportunities in responsible, resilient businesses aligned with global sustainability goals.

Style-agnostic and diversified approach

The strategy flexibly blends value, GARP and thematic ideas, allowing the team to adapt to changing market conditions and uncover opportunities across sectors, regions and cycles.

Investment Team

The strategy is led by Investment Director Ygal Sebban, a seasoned emerging markets investor with expertise across Latin America, Emerging Europe, the Middle East and South Africa. He is supported by a globally based team as well as GAM’s Fundamental Active Equity platform, providing access to a deep bench of seasoned investors and collaborative insights.

GAM Sustainable Emerging Equity seeks consistent alpha with strong risk-adjusted returns through a diversified portfolio of long only emerging markets stocks, including frontier plays.
Ygal Sebban, Investment Director
Ygal Sebban
Investment Director

Philosophy and Process

Investment Philosophy

The team believes long-term returns in emerging markets are driven by the ability to identify macroeconomic and thematic trends and express those views through carefully selected mispriced securities. Frequent inefficiencies – arising from regulatory, political and structural changes – create opportunities for active managers. To capture these, the strategy applies a consistent and repeatable process that blends top-down country analysis with bottom-up stock selection, supported by rigorous fundamental research and proprietary tools. Targeting companies with positive SDG alignment, leading ESG ratings, and lower carbon intensity is considered essential to identifying quality stocks and enhancing risk-adjusted returns. ESG and sustainability are embedded throughout the process to strengthen governance, resilience, and long-term outcomes.

Investment process

The team’s proven quantamental investment process combines proprietary modelling tools with qualitative judgement. Fundamental bottom-up valuation screens highlight the most undervalued and overvalued stocks across the universe, while top-down models analyse macroeconomic influences. Each company is assessed using structured templates and cross-referenced with company meetings and independent third-party research. This results in a set of mispriced stocks and attractive risk/return opportunities, which the team uses to actively construct a diversified portfolio of approximately 60 to 90 positions. A cross-asset class perspective informs position sizing and country exposures, with strong risk awareness maintained throughout.

ESG considerations are fully integrated at each stage of the investment process, targeting companies with positive SDG alignment, improving governance and lower carbon intensity to enhance quality, resilience and risk-adjusted returns. The process includes sovereign-level ESG screening, exclusion of companies with material environmental or social risks, and regular monitoring of ESG ratings, controversies and carbon metrics. GAM’s Responsible Investment team supports quarterly Principal Adverse Impact reviews, annual SDG alignment reassessments and targeted engagements with issuers.

1

Top-down analysis

  • TDAM model ranks countries by macro, ESG and liquidity factors
  • Timing sheet guides entry, exit and currency decisions
  • 70+ sovereign ESG metrics reviewed; poor governance or sustainability results in exclusion
2

Bottom-up valuation screens

  • Quant screens flag mispriced stocks
  • Proprietary templates assess valuation, fundamentals and ESG
  • Companies linked to weapons, tobacco, coal, oil sands or UNGC/OECD violations are excluded
  • ESG scores actively tracked from MSCI, RepRisk, Bloomberg
3

Stock analysis

  • Fundamental research supported by company meetings and analyst input
  • Consistent framework ensures disciplined investment theses
  • ESG factors are assessed for financial materiality
4

Portfolio construction and risk management

  • Blend top-down and bottom-up views to build conviction-led portfolios
  • Robust risk management across countries, stocks and currencies, with ESG reviews integrated throughout

Reasons to Invest

Secular and cyclical drivers

Emerging markets may offer sustainable long-term growth alongside a superior risk-return profile compared with developed markets.

Re-rating potential

Nearly all of the top 10 EM countries are now rated investment grade, making the asset class structurally safer than a decade ago.

Broad appeal

EM equities trade at relatively attractive valuations versus history and developed markets, providing opportunities for value, growth income-seeking investors.

Alpha generation

Frequent valuation dislocations in EM mean that active managers with strong fundamental tools can add value and enhance risk-adjusted returns.

Key Risks

Single Country Risk
: Investment in companies of a single country may be subject to greater political, social, economic and tax risks and may be more volatile than investments in more broadly diversified funds. Local tax law may change retrospectively and without notice.

ESG-Focused Investing Risk
: The Fund is subject to the risk that its ESG-focused investment strategy may select or exclude securities of certain issuers for reasons other than investment performance considerations. As a result, the Fund may underperform other funds that do not utilise an ESG-focused investment strategy. Certain ESG-focused investments may be dependent on government policies and subsidies, which are subject to change or elimination.

Capital at Risk
: All financial investments involve an element of risk. Therefore, the value of the investment and the income from it will vary and the initial investment amount cannot be guaranteed.

Counterparty or Derivatives Risk
: If a counterparty to a financial derivative contract were to default, the value of the contract, the cost to replace it and any cash or securities held by the counterparty to facilitate it, may be lost. The use of derivatives may create leverage, which can magnify both gains and losses; even small market movements can therefore result in proportionally larger changes in the Fund’s value, including the risk of significant loss of capital.

Currency Risk
: The value of investments in assets that are denominated in currencies other than the base currency will be affected by changes in the relevant exchange rates which may cause a decline.

Equity
: Investments in equities (directly or indirectly via derivatives) may be subject to fluctuations in value, and their values may be more volatile than those of other asset classes. Equities and equity-related securities (such as warrants and rights issues) can be affected by daily stock market movements.

Market Risk / Emerging Markets
: Emerging markets will generally be subject to greater political, market, counterparty and operational risks.

Special Country Risk / China
: Changes in China's political, social or economic policies may significantly affect the value of the Fund's investments. China's tax law is also applied under policies that may change without notice and with retrospective effect.

List Not Exhaustive
: This list of risk factors is not exhaustive. Please refer to the relevant Fund’s prospectus.

OuR Thinking

Investment Opinions
Five reasons we are positive on EM equities
18 August 2025 | Ygal Sebban

Emerging markets, once seen as volatile, are now demonstrating strong fundamentals and macro discipline—offering not just diversification, but real opportunity, says Ygal Sebban, Investment Director, Emerging Markets Equities.

Investment Opinions
Unlocking Opportunities in Emerging Markets
24 June 2025 | Ygal Sebban

Emerging market equities offer compelling opportunities, but demand selectivity. Investment Director Ygal Sebban highlights targeted areas of strength, driven by structural trends, policy support and valuation appeal.

Active Thinking
Active Thinking: Emerging Markets - Underowned and undervalued
31 October 2024 | Ygal Sebban

Ygal Sebban, Investment Director of Emerging Market Equity, explores the opportunities in emerging markets and explains why he believes investing in Chinese equities looks particularly appealing right now.

Our Thinking

Fund Information

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