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OYSTER

The data and information featured on this website are provided free of charge and solely for information purposes. The information contained herein constitutes neither an offer to purchase nor a solicitation to sell and may not be construed as an investment recommendation on the part of iM Global Partner Asset Management or other entities of the group iM Global Partner, its affiliates, managers, officers, or employees (hereafter « iMGP ») and has no legal or contractual value. Furthermore, any reference to a specific security in any published material is included by way of illustrative example and should not be construed as a recommendation to purchase, hold or sell such a security nor does it in any manner constitute the provision of investment advice in relation to same. OYSTER ( hereafter « OYSTER », « OYSTER Funds » or « Fund ») has not taken any measures to adapt to each individual investor who remains responsible for his own independent decisions. Any investment in the funds presented on the website must be made in conformity with the related legal documentation in force (prospectus, key investor information documents), as approved, where applicable, by the regulatory authority in your country. Oyster is an open-ended umbrella investment company established and regulated in Luxembourg. OYSTER is not open to citizens or residents of the USA or to any other party deemed to be a US person. OYSTER’s current prospectus, key investor information document, by-laws and the annual and, if any subsequent, the semi-annual reports of the Fund can be obtained on this website or from the OYSTER offices at 5, Allée Scheffer, L-2520 Luxembourg or from the Agents and Representatives listed on this website for the specific

jurisdictions where OYSTER is registered. Investors are advised that they should consult the Prospectus before seeking to subscribe and for further details on the risks involved. Moreover, investors are also advised to consult their legal, financial or tax advisors before taking any investment decisions.

Investors are reminded that past performance is not an indicator of future returns, nor does it guarantee future profits, and that they risk, in some cases, losing all or part of the amount initially invested. An investment may increase or decrease by virtue, in particular, of market fluctuations and exchange rate variations in the currency in which the Sub-fund is invested where this differs from the currency of the shareholder.

Disclosure in respect of iM Global Partner Asset Management

Any reference to iM Global Partner Asset Management (« iMGP AM ») or iM Global Partner (« iMGP ») in the material published on this website should be construed as being a reference to one or more of the legal entities, listed below, dependent on the particular jurisdiction in which it is being accessed.

iMGP AM is the Luxembourg management company of OYSTER.

iMGP is a French regulated entity which represents and distributes OYSTER that have been registered in France having branches in Italy, Spain, Germany and also subsidiaries in Switzerland and in the UK for that purpose. iMGP AM is also a subsidiary of iMGP.

Use of links

This website may direct you to automatic links to other websites. Use of these links is made at your own risk. iMGP and the Fund will not have developed, verified the accuracy or scrutinised the data contained in the aforementioned links. iMGP and the Fund may not be held responsible for damage or losses caused by delays, defects or omissions that may exist in the real, indicated or indirect services, information or other content provided on this site. iMGP and the Fund give no guarantee, makes no declaration and will not be held responsible for any content transmitted by electronic means to a third party, including the accuracy, subject, quality or the appropriate character of said content.

Copyrights and Trademarks

The entire content of this website is subject to copyright with all rights reserved to iMGP and the Fund. You may download or print out a hard copy of individual pages and/or sections of the website, provided that you do not remove any copyright or other proprietary notices. Any downloading or otherwise copying from the website will not transfer title to any software or material to you. You may not reproduce (in whole or in part), transmit (by electronic means or otherwise), modify, link into or use for any public or commercial purpose the website without the prior written permission of iMGP.

By clicking on the « Accept » button, you expressly acknowledge that you have read the aforementioned and that you are authorized by the applicable law to access this website.

YOUR USE OF THIS WEBSITE REQUIRES FULL ACCEPTANCE WITHOUT RESERVATION ON YOUR PART OF THE CONDITIONS OUTLINED BELOW. IF YOU DO NOT ACCEPT THESE CONDITIONS, DO NOT ACCESS THE WEB SITE OR ANY OF ITS PAGES.

Important Information

The content of this website is intended to Professional Investors. If you are a Private Investor, you should ensure to select the correct investor category when you enter this site, as failure to do so may result in you accessing material about investment funds and investment services which may not be suitable for you and/or may not be available for you to invest in.

Limited access

The information provided herein is also intended for Users in territories where it is permissible for Users to access information. This website may indeed contain information about funds established in different jurisdictions and/or investment services offered too. Please consult the specific sections and material to obtain more information. Users are responsible for ascertaining they are legally authorized to consult the information herein and should therefore ensure the investor category chosen to enter this website is correct.

Use of Cookies

Cookies help us collect data about you and how you use our website. For example, we are interested in knowing which internet browser is used, how long you visited the website and which pages you looked at. Information gathered are used to understand how we can improve the design and functionality of our website to better serve you in future. However, if you wish to restrict the cookies set by us or by any third-party sites, you may generally disable cookies in your internet browser. Your browser help function should let you know how to do this. Please keep in mind that restricting cookies may impact your experience and the functionality on this website.

The Interactive Advertising Bureau has produced a guide which explains how cookies work and how they are managed. Please visit www.allaboutcookies.org to read more on this subject.

OYSTER

The data and information featured on this website are provided free of charge and solely for information purposes. The information contained herein constitutes neither an offer to purchase nor a solicitation to sell and may not be construed as an investment recommendation on the part of iM Global Partner Asset Management or other entities of the group iM Global Partner, its affiliates, managers, officers, or employees (hereafter « iMGP ») and has no legal or contractual value. Furthermore, any reference to a specific security in any published material is included by way of illustrative example and should not be construed as a recommendation to purchase, hold or sell such a security nor does it in any manner constitute the provision of investment advice in relation to same. OYSTER ( hereafter « OYSTER », « OYSTER Funds » or « Fund ») has not taken any measures to adapt to each individual investor who remains responsible for his own independent decisions. Any investment in the funds presented on the website must be made in conformity with the related legal documentation in force (prospectus, key investor information documents), as approved, where applicable, by the regulatory authority in your country. Oyster is an open-ended umbrella investment company established and regulated in Luxembourg. OYSTER is not open to citizens or residents of the USA or to any other party deemed to be a US person. OYSTER’s current prospectus, key investor information document, by-laws and the annual and, if any subsequent, the semi-annual reports of the Fund can be obtained on this website or from the OYSTER offices at 5, Allée Scheffer, L-2520 Luxembourg or from the Agents and Representatives listed on this website for the specific

jurisdictions where OYSTER is registered. Investors are advised that they should consult the Prospectus before seeking to subscribe and for further details on the risks involved. Moreover, investors are also advised to consult their legal, financial or tax advisors before taking any investment decisions.

Investors are reminded that past performance is not an indicator of future returns, nor does it guarantee future profits, and that they risk, in some cases, losing all or part of the amount initially invested. An investment may increase or decrease by virtue, in particular, of market fluctuations and exchange rate variations in the currency in which the Sub-fund is invested where this differs from the currency of the shareholder.

Disclosure in respect of iM Global Partner Asset Management

Any reference to iM Global Partner Asset Management (« iMGP AM ») or iM Global Partner (« iMGP ») in the material published on this website should be construed as being a reference to one or more of the legal entities, listed below, dependent on the particular jurisdiction in which it is being accessed.

iMGP AM is the Luxembourg management company of OYSTER.

iMGP is a French regulated entity which represents and distributes OYSTER that have been registered in France having branches in Italy, Spain, Germany and also subsidiaries in Switzerland and in the UK for that purpose. iMGP AM is also a subsidiary of iMGP.

Use of links

This website may direct you to automatic links to other websites. Use of these links is made at your own risk. iMGP and the Fund will not have developed, verified the accuracy or scrutinised the data contained in the aforementioned links. iMGP and the Fund may not be held responsible for damage or losses caused by delays, defects or omissions that may exist in the real, indicated or indirect services, information or other content provided on this site. iMGP and the Fund give no guarantee, makes no declaration and will not be held responsible for any content transmitted by electronic means to a third party, including the accuracy, subject, quality or the appropriate character of said content.

Copyrights and Trademarks

The entire content of this website is subject to copyright with all rights reserved to iMGP and the Fund. You may download or print out a hard copy of individual pages and/or sections of the website, provided that you do not remove any copyright or other proprietary notices. Any downloading or otherwise copying from the website will not transfer title to any software or material to you. You may not reproduce (in whole or in part), transmit (by electronic means or otherwise), modify, link into or use for any public or commercial purpose the website without the prior written permission of iMGP.

By clicking on the « Accept » button, you expressly acknowledge that you have read the aforementioned and that you are authorized by the applicable law to access this website.

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OYSTER US Value

Eric Lynch
Managing director of Scharf Investments

Focusing on 25-30 of our best ideas

Eric Lynch, managing director of Scharf Investments speaks to Matthieu Beyler about how the OYSTER US Value fund is manically focused on protecting clients’ capital and why it is not a typical value fund.

What distinguishes your approach compared to other value managers ?

Most traditional value managers concentrate exclusively on mean reversion of the value of a company’s assets or earnings. Since cyclical businesses naturally present wider earnings variability and higher reversion potential, value managers often over-index to lower quality, or cyclical businesses. In addition, traditional value investors are often attracted to similarly very low multiple “value traps,” or companies facing permanent secular decline. Timing the purchase of a cyclical business correctly is very difficult. Betting against structural competitive forces even more so.

Scharf Investments also believes in mean reversion. However, the firm asserts that mean reversion potential improves considerably when limiting stock selection to high quality businesses, or companies with superior earnings sustainability over an economic cycle, superior capital returns, strong balance sheets and shareholder-oriented management. The firm believes quality value tends to deliver material
Scharf Investments also believes in mean reversion. However, the firm asserts that mean reversion potential improves considerably when limiting stock selection to high quality businesses, or companies with superior earnings sustainability over an economic cycle, superior capital returns, strong balance sheets and shareholder-oriented management. The firm believes quality value tends to deliver material outperformance in adverse and consolidating markets and result in risk-adjusted outperformance over complete market cycles.

Matthieu Beyler,
Director Distribution France and Luxembourg

Why do you have such a concentrated portfolio?

Three reasons:
1) Quality businesses are not often discounted at value prices;
2) A portfolio of 25-30 stocks is sufficient to eliminate nearly all non-systemic risk; and
3) A portfolio of best ideas allows deeper research, improves risk management and increases the potential for greater returns than a portfolio with a plethora of lower conviction holdings.

A portfolio of 25-30 stocks is sufficient to eliminate nearly all non-systemic risk

How do you identify companies with a strong outlook?

History does not repeat itself, but it sometimes rhymes. Pursuing a Hippocratic Oath derivation of investing, Scharf Investments is maniacally focused on first protecting client capital. The investment team generally limits stock selection to companies with top decile to quartile earnings predictability over the last economic cycle and performs deep research on stock and operating performance over decades of history, if available. All business change or evolve, most deteriorate. Some, however, have sustainable competitive advantages that the market temporarily misprices. The firm does deep research on a select group of businesses to separate the two.
Equity market participants sometimes focus more on forward one-year or less company performance and less on a company’s long-term prospects. Scharf Investments seeks to exploit near-term “dead money” opportunities by extending the investment time horizon and investing in the continued strong normalized earnings power of a quality business at a reduced valuation. All stocks purchased must have 30% plus upside to assessed base case fair value and, just as importantly, only a 10-15% downside potential. This 3-to-1 Favorability Ratio is a portfolio requirement and helps ensure the investment team purchases businesses with a sufficient margin of safety while also demanding compelling future returns. A superior earnings predictability requirement - past and future - helps preclude investments in value traps.

How do you see the evolution of ESG in your portfolio?

Scharf Investments currently incorporates ESG financial risk (via Morningstar’s Sustainalytics ESG data service) into the investment process as a risk management and investment tool. However, the strategy’s historical focus on earnings resilience and durable growth has always resulted in a portfolio of generally sustainable businesses. The firm’s origins and clients located in progressive-minded Northern California has also kept the investment team historically geared towards ESG even before ESG became so prevalent and “quantified”. Two of Scharf’s US mutual funds have a Morningstar Sustainalytics ESG risk rating in the top 10% of their universe. The investment team has historically excluded Tobacco and Gaming and tends to avoid businesses that present serious societal issues. For example, we have excluded Facebook to date, despite a compelling valuation at times, due in no small part to concerns about false information and self-esteem and mental health impacts to users.

The strategy’s historical focus on earnings resilience and durable growth has always resulted in a portfolio of generally sustainable businesses

Do you want to know more about OYSTER US Value?

The investment philosophy

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Fund performance

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Managed by

Founded in 1983 and based in Scotts Valley (CA, USA), the firm manages US equities strategies with a focused fundamental value approach.

The firm had $3.7bn AUM at the end of April 2021.

Visit Scharf Investments

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