RBC's Subjally: Macro factors should not drive selection

Focus on ESG

Habib Subjally, head of global equities at RBC Global Asset Management, has said managers who base stock selection around macro factors may be compromising fund performance by adding unnecessary risk to their portfolios.

Subjally (pictured), who runs the $1.26bn RBC Equity Focus fund, said the "complete diversification" of his 35-stock portfolio removes any country, sector, industry, momentum, size, or style bias and enables performance to be driven by bottom-up stock selection. "It is clear to me that future financial performance is driven by more than past financial performance, and selecting stocks with this sort of bias opens managers up to additional volatility," he said. "We do not want to take risks that do not directly relate to our investment philosophy. We use proper diversification across a...