UPDATE: This fund's managers travel to 150 countries a year to double their benchmark's return
By Philip van Doorn, MarketWatch
David Nadel and Mark Rayner of the Royce International Premier Fund meet companies where they're based -- from Switzerland to India
David Nadel and Mark Rayner, managers of the Royce International Premier Fund, rarely see their offices in New York and London, respectively.
That's because they're on the road visiting smaller companies -- a combined 150 countries a year between the two of them. They could be in Switzerland or India, Austria or Singapore. The Royce International Premier Fund buys mainly non-U.S. companies with market capitalizations of $3 billion or less.
The reward for investors: The fund has returned 32% this year, about double that of the benchmark Russell Global ex-U.S. Small Cap Index.
Royce International Premier, which has received four out of five stars from fund researcher Morningstar, invests "exclusively in local markets," Nadel said, meaning it doesn't buy shares traded on U.S. exchanges. "The shareholders of our holdings tend to be locals. We have to go to these markets to meet with them."
The managers typically invest in companies "that are deeply customer-focused, with the philosophy being that if the customer is served well, the shareholders will be served well over time," Nadel said.
That leads to a portfolio with many companies that primarily serve one country. That's a way to diversify from big-name conglomerates that operate all over the world in a sometimes overly complex way.