Federated Hermes Incorporated
Federated Hermes, Inc. is a leading global investment manager with $605.8 billion in assets under management as of March 31, 2020. Guided by their conviction that responsible investing is the best way to create wealth over the long term, their investment solutions span 163 equity, fixed-income, alternative/private markets, multi-asset and liquidity management strategies and a range of separately managed account strategies. Providing world-class active investment management and engagement services to more than 11,000 institutions and intermediaries, their clients include corporations, government entities, insurance companies, foundations and endowments, banks and broker/dealers. Headquartered in Pittsburgh, Federated Hermes’ more than 1,900 employees include those in London, New York, Boston and several other offices worldwide. For more information, visit FederatedHermes.com.
The investment process applies a quantitative bottom-up approach that weighs both the potential of a company's assets against short term investor sentiment that can cause stock prices to significantly deviate from fair value.
Hermes employs a proprietary multi-faceted model (The Alpha Model) that is applied across the investment universe of over 5000 global companies. The model is built on fundamental company analysis that provides statistical evidence to predict which companies are most attractive and likely to outperform over a three-year period. The Alpha model focuses on changes in trading multiple, the ability to increase earnings power and the ability to generate shareholder return by concentrating on six fundamental factors: valuation, sentiment, profitability, growth, corporate behaviour and capital structure. Each company is then scored and ranked against sector peers to ensure sector biases are removed.
The second part of the investment process introduces an Environmental, Social and Governance (ESG) scoring system (QESG Score) that uncovers a stock's exposure to a wide range of industry-specific ESG risk factors and how each company manages through them. Companies that show a positive trend towards management of ESG issues score higher and are favored.
The Alpha Model Score and QESG Score of each company are then combined through a portfolio optimizer that also considers portfolio constraints and risk/return trade-off — resulting in a optimal portfolio of 70 to 100 stocks.
|Name||Lead Managers||Inception Date||Category||Morningstar Profile|
|NEI Global Equity RS Fund*||Geir Lode
*Effective August 30, 2016, the portfolio manager of the NEI Global Equity RS Fund has changed from Manning & Napier Advisors, LLC to Hermes Investment Management Ltd.
Head of Global Equities and Lead Portfolio Manager
Geir Lode joined Hermes in May 2007 to establish the Global Equities strategy. Prior to this he was Chairman of Bergen Yards in Bergen, Norway, where he was responsible for restructuring and focusing a holding company. Bergen Yards changed name to Bergen Group and was listed on the Oslo stock exchange in June 2007. Geir started his career in 1991 at Frank Russell, moving to Chancellor LGT and then Putnam Investments, where he was a senior vice president before returning to Norway in 2003. Geir studied Mechanical Engineering at the Norwegian Institute of Technology and obtained a Master of Business Administration at the Pacific Lutheran University, Washington.
Senior Portfolio Manager
Lewis joined Hermes in February 2008 as a Global Equities portfolio manager. In addition to his role as portfolio manager, Lewis is responsible for designing and implementing many of the team's systems. In particular he created Hermes' proprietary risk-modelling system, MultiFRAME, utilised by the majority of Hermes' investment teams. He joined from Aon Consulting, where he worked as an actuarial consultant specialising in providing valuations and asset-liability modelling to a range of corporate and institutional clients. Lewis graduated from the University of Warwick in 2003 with a master's degree in Mathematics, Operational Research, Statistics and Economics and subsequently qualified as a Fellow of the Institute of Actuaries.
Louise joined Hermes in March 2009 in the Equity Ownership Services team, transferring to work on the Global Equities strategy later that year. She fulfils the role of ESG specialist and champions responsible asset management within the team. Prior to Hermes she worked for Coca Cola in Australia. She graduated with a master's degree in Engineering from the University of Durham in 2007 specialising in Design, Manufacture and Management.