Renaissance Investment Management - International Small Cap Equity

Investor Summary

Renaissance Investment Management, founded in 1978, operates as an affiliate of Affiliated Managers Group (AMG) since 1995, managing approximately $2.6-2.77 billion in total assets. The firm serves institutional and high-net-worth clients through a unique partnership model that provides scale benefits in distribution and compliance while allowing investment professionals to focus on portfolio management. Led by Managing Partner and CIO Michael E. Schroer, CFA, who brings over 30 years of investment experience since joining Renaissance in 1984, the firm maintains SEC registration under CRD #105916 and operates with GIPS compliance verification from 2006-2024. The International Small Cap Equity Strategy is available through separate accounts, SMA platforms, and UMA programs, targeting institutional clients, Taft Hartley plans, individuals, ERISA accounts, and public clients with standard management fees of 1.00% of assets under management.

Fund Strategy

The Renaissance International Small Cap Equity Strategy employs a Growth At a Reasonable Price (GARP) investment philosophy, combining proprietary quantitative modeling with fundamental bottom-up analysis to identify non-U.S. small cap companies exhibiting above-average profitability and earnings growth trading at reasonable valuations. The strategy seeks companies with three key attributes: strong growth characteristics, substantial earnings momentum, and reasonable stock valuations. Portfolio construction utilizes computer-generated screens to identify companies with favorable characteristics, followed by qualitative fundamental analysis. The approach emphasizes disciplined, process-oriented decision making based on intensive research, targeting companies with market capitalizations between $100 million and $4 billion outside the United States. Risk management is achieved through diversification, sector exposure limits (40% maximum in any sector), and ongoing reviews of geopolitical and factor risks.

ANNUALIZED SINCE INCEPTION	QUARTERLY	YTD
-	-	-

Executive Summary

Renaissance's International Small Cap Equity strategy delivered positive absolute returns and outperformed its benchmark in Q2 2026, driven by strong stock selection across all sectors and positive sector allocation effects. The portfolio benefited from semiconductor exposure, particularly Silicon Motion Technology, which gained from NAND supply chain dynamics as memory makers outsource controller development. Garrett Motion also contributed positively as slower EV penetration improved sentiment for traditional turbocharger business while zero-emission technology prospects grew. The manager purchased TGS, an energy data services provider positioned to benefit from an improving oil capex cycle driven by energy security concerns and a decade of underinvestment. Vermilion Energy was sold due to limited production growth catalysts. International equities have outperformed U.S. peers by 22% since early 2025, coinciding with improved earnings growth expectations. Despite this, international equities trade at a 32% discount to U.S. peers, presenting an attractive diversification alternative. Key risks include semiconductor index concentration driving heightened volatility and weakening Chinese consumer spending, though potential stimulus measures could provide support.

Forward Outlook

Given the ongoing improved earnings and price momentum for international equities, along with a still-wide 32% valuation discount to U.S. peers, investors should consider selected international stocks as an increasingly attractive diversification alternative to a richly valued U.S. stock market. International equities have outperformed U.S. peers by 22% since the beginning of 2025, and average annual international earnings growth is expected to be stronger than U.S. earnings growth from 2025-2027.

Date	Letter	Tickers	Keywords	Pitches	Quick Takes
Jul 20 2026	2026 Q2	GTX, MEOH, SIMO, VET	China, emerging markets, energy, international, semiconductors, small caps, value	VET SIMO GTX MEOH ARIS	Renaissance's international small cap strategy outperformed in Q2 2026, led by semiconductor holdings benefiting from NAND supply chain dynamics and traditional auto components gaining from slower EV adoption. The manager added energy services exposure while trimming commodity-dependent producers. International equities trade at a 32% discount to U.S. peers despite superior expected earnings growth through 2027, creating compelling value for diversification-seeking investors.
Apr 21 2026	2026 Q1	CWK, EFXT, FELTY, PTXKY, SMSMY, TSEM, WBRBY	AI, China, Commercial real estate, energy, international, small cap, Trade Policy	-	Renaissance's international small cap strategy outperformed in Q1 2026 despite Iran war volatility. Energy overweight and AI beneficiary Tower Semiconductor drove gains while commercial real estate faced disruption fears. China lowered growth targets amid economic transition, Europe advanced trade deals, and Japan's ruling party won supermajority. Strong earnings growth expectations and attractive valuations support continued international equity appeal.
Jan 21 2026	2025 Q4	0696.HK, 4536.T, ARIS.TO, DCBO, EFXT, ERO, GLNG, IMOS, KLBN4.SA, NOMD.L, PSFE, PTXKY, RDWR, TMVWY, TSEM, TTVSY	AI, China, Copper, gold, international, Mining, semiconductors, small cap	TSEM PSFE ARIS CN	Renaissance's international small cap strategy outperformed in Q4 2025, driven by AI beneficiary Tower Semiconductor and strategic positioning in gold mining through Aris Mining addition. Despite tariff uncertainties for 2026, international small caps offer compelling value at 33% discount to U.S. peers with double-digit earnings growth expected.
Oct 21 2025	2025 Q3	CLS, CWK, FELTY, KOF, MRX, NOMD, RDWR, TIGO, TSEM, WBRBY	AI, China, emerging markets, Europe, international, semiconductors, small cap, Trade Policy	TSEM TSEM	International small caps delivered strong third quarter returns, outperforming U.S. equities by 12% year-to-date. Portfolio benefited from AI-driven semiconductor demand and Chinese stimulus while managing French political risk. Despite trade tensions and elevated tariffs, global growth forecasts improved. International equities offer attractive valuations at 35% discount to U.S. markets with strong earnings growth potential.
Jul 21 2025	2025 Q2	8252.T, ATAT, BBY.L, CLS, FINV, IFS, MITFY, NOMD, OMAB, PLYA, PSFE, SIMO, TIGO, TMVWY, VLRS	AI, China, Dollar, Europe, infrastructure, international, small cap, Trade Policy	CLS CN BBY LN	International small caps posted strong returns despite trade volatility, benefiting from dollar weakness and AI infrastructure demand. The strategy added UK infrastructure exposure while exiting Chinese positions due to delisting risks. European defense and infrastructure spending provides multi-year tailwinds, though trade uncertainty may pressure global growth in the second half.
Mar 31 2025	2025 Q1	FINV, ITRN, KOF, MEOH, MTLS, NOMD, TGLS, TIGO, TSEM, VLRS, WBRBY, YUEIY	China, Europe, international, Manufacturing, small cap, tariffs, valuation	-	International small caps face tariff headwinds but benefit from structural shifts as Europe increases defense and infrastructure spending while China boosts stimulus. Despite negative Q1 returns, diverging manufacturing trends favor international markets over the U.S. The 34% valuation discount versus U.S. equities creates compelling opportunities as positive structural changes support normalization.
Dec 31 2024	2024 Q4	6481.T, 6849.T, ATAT, BB.PA, CLS, CSTM, CWK, ERO, FINV, IMAX, MRX.L, MTLS, NEXNY, OSW, PLYA, PRMB, RDWR, SPNS, STNG, TPK.L, UBI.PA, WNS	China, Europe, international, small cap, tariffs, Trade Policy	-	International small caps delivered negative Q4 returns but outperformed benchmarks through strong stock selection. Despite trade policy headwinds and political uncertainty, the asset class offers compelling value at 40% discount to U.S. peers with 9% earnings growth expected in 2025 and supportive monetary policy from ECB and China providing recovery catalysts.

Date

Letter

Tickers

Keywords

Pitches

Quick Takes

Jul 20 2026

2026 Q2

GTX, MEOH, SIMO, VET

China, emerging markets, energy, international, semiconductors, small caps, value

VET
SIMO
GTX
MEOH
ARIS

Renaissance's international small cap strategy outperformed in Q2 2026, led by semiconductor holdings benefiting from NAND supply chain dynamics and traditional auto components gaining from slower EV adoption. The manager added energy services exposure while trimming commodity-dependent producers. International equities trade at a 32% discount to U.S. peers despite superior expected earnings growth through 2027, creating compelling value for diversification-seeking investors.

Apr 21 2026

2026 Q1

CWK, EFXT, FELTY, PTXKY, SMSMY, TSEM, WBRBY

AI, China, Commercial real estate, energy, international, small cap, Trade Policy

Renaissance's international small cap strategy outperformed in Q1 2026 despite Iran war volatility. Energy overweight and AI beneficiary Tower Semiconductor drove gains while commercial real estate faced disruption fears. China lowered growth targets amid economic transition, Europe advanced trade deals, and Japan's ruling party won supermajority. Strong earnings growth expectations and attractive valuations support continued international equity appeal.

Jan 21 2026

2025 Q4

0696.HK, 4536.T, ARIS.TO, DCBO, EFXT, ERO, GLNG, IMOS, KLBN4.SA, NOMD.L, PSFE, PTXKY, RDWR, TMVWY, TSEM, TTVSY

AI, China, Copper, gold, international, Mining, semiconductors, small cap

TSEM
PSFE
ARIS CN

Renaissance's international small cap strategy outperformed in Q4 2025, driven by AI beneficiary Tower Semiconductor and strategic positioning in gold mining through Aris Mining addition. Despite tariff uncertainties for 2026, international small caps offer compelling value at 33% discount to U.S. peers with double-digit earnings growth expected.

Oct 21 2025

2025 Q3

CLS, CWK, FELTY, KOF, MRX, NOMD, RDWR, TIGO, TSEM, WBRBY

AI, China, emerging markets, Europe, international, semiconductors, small cap, Trade Policy

TSEM
TSEM

International small caps delivered strong third quarter returns, outperforming U.S. equities by 12% year-to-date. Portfolio benefited from AI-driven semiconductor demand and Chinese stimulus while managing French political risk. Despite trade tensions and elevated tariffs, global growth forecasts improved. International equities offer attractive valuations at 35% discount to U.S. markets with strong earnings growth potential.

Jul 21 2025

2025 Q2

8252.T, ATAT, BBY.L, CLS, FINV, IFS, MITFY, NOMD, OMAB, PLYA, PSFE, SIMO, TIGO, TMVWY, VLRS

AI, China, Dollar, Europe, infrastructure, international, small cap, Trade Policy

CLS CN
BBY LN

International small caps posted strong returns despite trade volatility, benefiting from dollar weakness and AI infrastructure demand. The strategy added UK infrastructure exposure while exiting Chinese positions due to delisting risks. European defense and infrastructure spending provides multi-year tailwinds, though trade uncertainty may pressure global growth in the second half.

Mar 31 2025

2025 Q1

FINV, ITRN, KOF, MEOH, MTLS, NOMD, TGLS, TIGO, TSEM, VLRS, WBRBY, YUEIY

China, Europe, international, Manufacturing, small cap, tariffs, valuation

International small caps face tariff headwinds but benefit from structural shifts as Europe increases defense and infrastructure spending while China boosts stimulus. Despite negative Q1 returns, diverging manufacturing trends favor international markets over the U.S. The 34% valuation discount versus U.S. equities creates compelling opportunities as positive structural changes support normalization.

Dec 31 2024

2024 Q4

6481.T, 6849.T, ATAT, BB.PA, CLS, CSTM, CWK, ERO, FINV, IMAX, MRX.L, MTLS, NEXNY, OSW, PLYA, PRMB, RDWR, SPNS, STNG, TPK.L, UBI.PA, WNS

China, Europe, international, small cap, tariffs, Trade Policy

International small caps delivered negative Q4 returns but outperformed benchmarks through strong stock selection. Despite trade policy headwinds and political uncertainty, the asset class offers compelling value at 40% discount to U.S. peers with 9% earnings growth expected in 2025 and supportive monetary policy from ECB and China providing recovery catalysts.

QUARTER	THEMES	TAGS
2026 Q2	Semiconductor Cycle Emerging markets semiconductor companies including Taiwan Semiconductor, SK hynix, and Samsung Electronics drove 75% of index gains in Q2. Silicon Motion Technology benefited from NAND supply chain dynamics as memory makers outsource controller development, driving share gains in embedded eMMC/UFS and client SSDs. Index concentration in these three companies reached over 30% of the iShares MSCI Emerging Markets ETF.	NAND Memory Controllers Semiconductors Taiwan Semiconductor
	Energy TGS was purchased as a beneficiary of an improving capex cycle for oil companies driven by energy security concerns and a shift in investor focus from shareholder returns to declining reserves after a decade of underinvestment. The company owns a vast library of sub-surface data used for exploration and offshore wind site characterization. Vermilion Energy was sold due to limited near-term production growth catalysts and dependence on commodity price movements.	Oil Capex Exploration Seismic Energy Security
	China Chinese equities sold off for the third consecutive quarter as economic growth turned uneven. Export-oriented segments benefited from semiconductor and AI hardware demand, but the consumer economy clearly weakened with year-over-year retail sales dropping into negative territory for the first time since COVID. The persistently weak housing market continues to weigh on consumption, though this could incentivize new consumption-based stimulus measures.	Consumer Retail Sales Housing Stimulus Exports
	Electric Vehicles Slower market penetration for electric vehicles, particularly in the United States, is helping improve sentiment for Garrett Motion's traditional internal combustion engine turbocharger business. Prospects are growing for the company's zero-emission technologies segment, which includes hydrogen fuel cell compressors, e-powertrains, and e-cooling compressors.	EV Penetration Turbochargers Hydrogen Zero-emission
	Gold Aris Mining shares retreated as the price of gold fell from its all-time high earlier in the year. However, ramping production from the Marmato mine in Colombia gives the company solid growth prospects over the next several years.	Gold Miners Production Colombia
	Dollar The U.S. dollar strengthened during the quarter, adding to gains over the past year. Asian currencies were among the hardest hit, including the South Korean won reaching its lowest level in over fifteen years and the Japanese yen reaching its lowest level in nearly four decades despite the Bank of Japan's rate hiking cycle. The dollar received support from new Fed Chair Kevin Warsh's unexpectedly hawkish stance.	Currency Won Yen Fed
	Value International equities have outperformed U.S. peers by 22% since the beginning of 2025, coinciding with improved earnings growth. Average annual international earnings growth is expected to be stronger than U.S. earnings growth from 2025-2027. Despite this, international equities currently trade at a 32% discount to U.S. peers, a large discount by historical standards, making selected international stocks an increasingly attractive diversification alternative to a richly valued U.S. stock market.	Valuation Discount Earnings Growth International
2026 Q1	Energy Energy sector overweight helped portfolio returns during the quarter. Iran war sparked market selloff and pushed energy prices higher, causing investors to weigh impact on inflation and interest rates. Natural gas demand increasing due to electricity demand growth.	Natural Gas Energy Infrastructure Oil Iran
	AI Tower Semiconductor benefited from accelerating AI demand with strong momentum in RF infrastructure and silicon photonics businesses. Customer demand far outpacing current supply, prompting capacity expansion. AI disruption fears hit commercial real estate industry.	Semiconductors Data Centers Infrastructure
	China Chinese government set 2026 GDP growth target at 4.5-5%, lowest on record, reflecting transition to higher-quality growth model. Government reducing industrial overcapacity and price wars. Chinese equities weakened over past two quarters due to lower growth targets and lack of stimulus.	GDP Growth Industrial Policy Stimulus
	Trade Policy European Union signed significant trade deals including free-trade agreement with Mercosur after twenty-five years of negotiations, plus agreements with India and Australia. These deals should help future growth by opening new markets and decreasing EU dependence on volatile US trade policy.	European Union Trade Deals Mercosur
	Commercial Real Estate Cushman & Wakefield shares under pressure due to AI disruption fears hitting the entire commercial real estate industry. Despite fears, company reported solid quarter and remains well positioned for growth as activity improves.	Real Estate Services AI Disruption
2025 Q4	Behavioral Finance Manager discusses behavioral biases in investing, comparing rational Morning Investor mode versus impulsive Nighttime Investor decisions. Emphasizes the importance of overcoming psychological biases like avoiding action that could cause regret, and building habits to make better investment decisions.	Behavioral Biases Psychology Decision Making
	Value Mature (Value) businesses led performance in Q4 and were the strongest contributors for the full year, reflecting durable execution in companies generating healthy free cash flow and returning capital.	Free Cash Flow Capital Returns Mature Businesses
	Growth Emerging (Growth) businesses reversed substantial gains in Q4 but delivered strong year overall with significant alpha relative to benchmark. Despite weak Q4 performance, the full-year results were positive.	Alpha Generation Emerging Businesses
2025 Q3	AI The emergence of an arms race in artificial intelligence has aligned China's government and its technology stocks with the goal of producing Chinese-made artificial intelligence infrastructure that can compete with American-made technology. Tower Semiconductor is capitalizing on high demand for data centers and artificial intelligence through increased capacity in Silicon Photonics and Silicon Germanium.	Data Centers Semiconductors China Technology Infrastructure
	China Chinese stocks helped emerging markets outperform developed markets by 6% during the third quarter. While Chinese stocks have not fully recovered from the 2021-2023 sell-off following regulatory crackdown, stimulus announcements in 2024 helped propel an initial stock market surge. China's economy continues to face headwinds from trade tensions and a continued weak property market.	Emerging Markets Stimulus Property Market Trade Tensions Technology
	Trade Policy Markets have been surprisingly resilient in the face of continued tariff headlines. The effective tariff rate in the United States has risen from an estimated 2% at the beginning of the year to an estimated 19% at the end of August, its highest level since the 1930s. The full negative impact of tariffs has likely not been felt due to a short-term boost in growth from front-loading ahead of tariff enactment deadlines.	Tariffs Global Trade Economic Growth Policy Resilience
	Europe Political turmoil in France continues with no end in sight, resulting in a hung parliament and repeated collapse of minority governments. France's heavy debt burden and political impasse have triggered credit downgrades, while southern European nations including Italy, Spain, and Greece have received credit upgrades. Europe continues to see an improved outlook, with the eurozone manufacturing PMI rising into expansionary territory for the first time in over three years.	Political Risk Credit Ratings Manufacturing Debt Recovery
2025 Q2	Trade Policy International markets navigated significant trade tensions between the US and China, including Liberation Day tariffs followed by a ninety-day pause. Trade uncertainty may cause businesses to delay investments and capex, weighing on global growth in the second half of the year.	Tariffs Trade War China Uncertainty Investment
	Dollar The US Dollar Index fell nearly 11% in the first half of the year, the worst start in over thirty years. Dollar weakness helped international equities outperform US peers, with the American exceptionalism trade appearing to fade after over a decade.	Dollar Weakness Currency International Outperformance Reserve Currency
	Infrastructure Spending European governments are prioritizing infrastructure investment, power grid upgrades, and defense spending. This multi-year fiscal stimulus should provide sustained benefits across various industries, with companies like Balfour Beatty positioned to benefit.	Infrastructure Defense Fiscal Stimulus Europe Multi-year
	AI Celestica benefited from continued robust demand from hyperscaler customers for 400G and 800G networking switches, driven by secular growth trends in cloud infrastructure and AI networking that pushed operating margins to record highs.	Hyperscalers Networking Cloud Infrastructure Secular Growth Margins
2025 Q1	Trade Policy Trump implemented universal 10% tariffs and reciprocal tariffs on sixty nations, creating economic uncertainty that may slow global growth as companies hold back on investment plans. The rapid-fire conflicting statements from the administration have increased uncertainty about future trade policies.	Tariffs Trade Uncertainty Global Policy
	Infrastructure Spending Germany reformed its debt brake allowing one trillion euros for defense and infrastructure spending, while the EU proposed the Security Action for Europe package providing funding for member states to scale up defense investments. This should boost European economic growth after years of underinvestment.	Defense Infrastructure Europe Spending Growth
	China China is boosting spending with target deficit spending at 4% of GDP, the highest in fifteen years. Prior stimulus measures appear to be stabilizing the economy with the Caixin Manufacturing PMI remaining in expansionary territory for six consecutive months.	Stimulus Manufacturing PMI Deficit Economy
2024 Q4	Trade Policy Trade tensions are front of mind for investors and likely to ratchet higher in 2025 after Trump takes office. Trump has floated ideas such as a 10% tariff on all imports and 60% tariff on Chinese imports. Countries running large trade deficits with the US are most at risk.	Tariffs China Trade War Exports Imports
	China China decreased its dependence on the US following the first trade war, with exports to US falling from 19% to 15%. Stimulus measures in H2 2024 are having positive impact with December PMI rising to highest since March. Government signaled more moderately loose monetary policy for first time since 2011.	Stimulus PMI Yuan Monetary Policy Domestic Demand
	Europe Europe saw strong initial recovery post-pandemic but war in Ukraine and energy prices caused low growth period. Eurozone reported highest GDP growth in two years in Q3 but still lagged US. European consumers reverted to saving instead of spending, contrasting with US behavior.	GDP Growth Consumer Spending Energy Prices ECB Interest Rates

QUARTER

THEMES

Semiconductor Cycle

Emerging markets semiconductor companies including Taiwan Semiconductor, SK hynix, and Samsung Electronics drove 75% of index gains in Q2. Silicon Motion Technology benefited from NAND supply chain dynamics as memory makers outsource controller development, driving share gains in embedded eMMC/UFS and client SSDs. Index concentration in these three companies reached over 30% of the iShares MSCI Emerging Markets ETF.

NAND Memory Controllers Semiconductors Taiwan Semiconductor

Energy

TGS was purchased as a beneficiary of an improving capex cycle for oil companies driven by energy security concerns and a shift in investor focus from shareholder returns to declining reserves after a decade of underinvestment. The company owns a vast library of sub-surface data used for exploration and offshore wind site characterization. Vermilion Energy was sold due to limited near-term production growth catalysts and dependence on commodity price movements.

Oil Capex Exploration Seismic Energy Security

China

Chinese equities sold off for the third consecutive quarter as economic growth turned uneven. Export-oriented segments benefited from semiconductor and AI hardware demand, but the consumer economy clearly weakened with year-over-year retail sales dropping into negative territory for the first time since COVID. The persistently weak housing market continues to weigh on consumption, though this could incentivize new consumption-based stimulus measures.

Consumer Retail Sales Housing Stimulus Exports

Electric Vehicles

Slower market penetration for electric vehicles, particularly in the United States, is helping improve sentiment for Garrett Motion's traditional internal combustion engine turbocharger business. Prospects are growing for the company's zero-emission technologies segment, which includes hydrogen fuel cell compressors, e-powertrains, and e-cooling compressors.

EV Penetration Turbochargers Hydrogen Zero-emission

Gold

Aris Mining shares retreated as the price of gold fell from its all-time high earlier in the year. However, ramping production from the Marmato mine in Colombia gives the company solid growth prospects over the next several years.

Gold Miners Production Colombia

Dollar

The U.S. dollar strengthened during the quarter, adding to gains over the past year. Asian currencies were among the hardest hit, including the South Korean won reaching its lowest level in over fifteen years and the Japanese yen reaching its lowest level in nearly four decades despite the Bank of Japan's rate hiking cycle. The dollar received support from new Fed Chair Kevin Warsh's unexpectedly hawkish stance.

Currency Won Yen Fed

Value

International equities have outperformed U.S. peers by 22% since the beginning of 2025, coinciding with improved earnings growth. Average annual international earnings growth is expected to be stronger than U.S. earnings growth from 2025-2027. Despite this, international equities currently trade at a 32% discount to U.S. peers, a large discount by historical standards, making selected international stocks an increasingly attractive diversification alternative to a richly valued U.S. stock market.

Valuation Discount Earnings Growth International

2026 Q1

Energy

Energy sector overweight helped portfolio returns during the quarter. Iran war sparked market selloff and pushed energy prices higher, causing investors to weigh impact on inflation and interest rates. Natural gas demand increasing due to electricity demand growth.

Natural Gas Energy Infrastructure Oil Iran

AI

Tower Semiconductor benefited from accelerating AI demand with strong momentum in RF infrastructure and silicon photonics businesses. Customer demand far outpacing current supply, prompting capacity expansion. AI disruption fears hit commercial real estate industry.

Semiconductors Data Centers Infrastructure

China

Chinese government set 2026 GDP growth target at 4.5-5%, lowest on record, reflecting transition to higher-quality growth model. Government reducing industrial overcapacity and price wars. Chinese equities weakened over past two quarters due to lower growth targets and lack of stimulus.

GDP Growth Industrial Policy Stimulus

Trade Policy

European Union signed significant trade deals including free-trade agreement with Mercosur after twenty-five years of negotiations, plus agreements with India and Australia. These deals should help future growth by opening new markets and decreasing EU dependence on volatile US trade policy.

European Union Trade Deals Mercosur

Commercial Real Estate

Cushman & Wakefield shares under pressure due to AI disruption fears hitting the entire commercial real estate industry. Despite fears, company reported solid quarter and remains well positioned for growth as activity improves.

Real Estate Services AI Disruption

2025 Q4

Behavioral Finance

Manager discusses behavioral biases in investing, comparing rational Morning Investor mode versus impulsive Nighttime Investor decisions. Emphasizes the importance of overcoming psychological biases like avoiding action that could cause regret, and building habits to make better investment decisions.

Behavioral Biases Psychology Decision Making

Value

Mature (Value) businesses led performance in Q4 and were the strongest contributors for the full year, reflecting durable execution in companies generating healthy free cash flow and returning capital.

Free Cash Flow Capital Returns Mature Businesses

Growth

Emerging (Growth) businesses reversed substantial gains in Q4 but delivered strong year overall with significant alpha relative to benchmark. Despite weak Q4 performance, the full-year results were positive.

Alpha Generation Emerging Businesses

2025 Q3

AI

The emergence of an arms race in artificial intelligence has aligned China's government and its technology stocks with the goal of producing Chinese-made artificial intelligence infrastructure that can compete with American-made technology. Tower Semiconductor is capitalizing on high demand for data centers and artificial intelligence through increased capacity in Silicon Photonics and Silicon Germanium.

Data Centers Semiconductors China Technology Infrastructure

China

Chinese stocks helped emerging markets outperform developed markets by 6% during the third quarter. While Chinese stocks have not fully recovered from the 2021-2023 sell-off following regulatory crackdown, stimulus announcements in 2024 helped propel an initial stock market surge. China's economy continues to face headwinds from trade tensions and a continued weak property market.

Emerging Markets Stimulus Property Market Trade Tensions Technology

Trade Policy

Markets have been surprisingly resilient in the face of continued tariff headlines. The effective tariff rate in the United States has risen from an estimated 2% at the beginning of the year to an estimated 19% at the end of August, its highest level since the 1930s. The full negative impact of tariffs has likely not been felt due to a short-term boost in growth from front-loading ahead of tariff enactment deadlines.

Tariffs Global Trade Economic Growth Policy Resilience

Europe

Political turmoil in France continues with no end in sight, resulting in a hung parliament and repeated collapse of minority governments. France's heavy debt burden and political impasse have triggered credit downgrades, while southern European nations including Italy, Spain, and Greece have received credit upgrades. Europe continues to see an improved outlook, with the eurozone manufacturing PMI rising into expansionary territory for the first time in over three years.

Political Risk Credit Ratings Manufacturing Debt Recovery

2025 Q2

Trade Policy

International markets navigated significant trade tensions between the US and China, including Liberation Day tariffs followed by a ninety-day pause. Trade uncertainty may cause businesses to delay investments and capex, weighing on global growth in the second half of the year.

Tariffs Trade War China Uncertainty Investment

Dollar

The US Dollar Index fell nearly 11% in the first half of the year, the worst start in over thirty years. Dollar weakness helped international equities outperform US peers, with the American exceptionalism trade appearing to fade after over a decade.

Dollar Weakness Currency International Outperformance Reserve Currency

Infrastructure Spending

European governments are prioritizing infrastructure investment, power grid upgrades, and defense spending. This multi-year fiscal stimulus should provide sustained benefits across various industries, with companies like Balfour Beatty positioned to benefit.

Infrastructure Defense Fiscal Stimulus Europe Multi-year

AI

Celestica benefited from continued robust demand from hyperscaler customers for 400G and 800G networking switches, driven by secular growth trends in cloud infrastructure and AI networking that pushed operating margins to record highs.

Hyperscalers Networking Cloud Infrastructure Secular Growth Margins

2025 Q1

Trade Policy

Trump implemented universal 10% tariffs and reciprocal tariffs on sixty nations, creating economic uncertainty that may slow global growth as companies hold back on investment plans. The rapid-fire conflicting statements from the administration have increased uncertainty about future trade policies.

Tariffs Trade Uncertainty Global Policy

Infrastructure Spending

Germany reformed its debt brake allowing one trillion euros for defense and infrastructure spending, while the EU proposed the Security Action for Europe package providing funding for member states to scale up defense investments. This should boost European economic growth after years of underinvestment.

Defense Infrastructure Europe Spending Growth

China

China is boosting spending with target deficit spending at 4% of GDP, the highest in fifteen years. Prior stimulus measures appear to be stabilizing the economy with the Caixin Manufacturing PMI remaining in expansionary territory for six consecutive months.

Stimulus Manufacturing PMI Deficit Economy

2024 Q4

Trade Policy

Trade tensions are front of mind for investors and likely to ratchet higher in 2025 after Trump takes office. Trump has floated ideas such as a 10% tariff on all imports and 60% tariff on Chinese imports. Countries running large trade deficits with the US are most at risk.

Tariffs China Trade War Exports Imports

China

China decreased its dependence on the US following the first trade war, with exports to US falling from 19% to 15%. Stimulus measures in H2 2024 are having positive impact with December PMI rising to highest since March. Government signaled more moderately loose monetary policy for first time since 2011.

Stimulus PMI Yuan Monetary Policy Domestic Demand

Europe

Europe saw strong initial recovery post-pandemic but war in Ukraine and energy prices caused low growth period. Eurozone reported highest GDP growth in two years in Q3 but still lagged US. European consumers reverted to saving instead of spending, contrasting with US behavior.

GDP Growth Consumer Spending Energy Prices ECB Interest Rates

Date	Pitch Type	Author	Ticker	Company	Industry	Sub Industry	Bull / Bear	Exchange	Keywords	Action
Jul 20, 2026	Fund Letters	Renaissance Investment Management - International Small Cap Equity	-	TGS	Oil & Gas Equipment & Services	Oil & Gas Equipment & Services	Bull	Oslo Bors (Oslo Stock Exchange)	backlog growth, CapEx cycle, energy, Energy security, Exploration, Marine services, Norway, Offshore Wind, Oil & Gas Equipment & Services, seismic data	Login
Jul 20, 2026	Fund Letters	Renaissance Investment Management - International Small Cap Equity	VET	Vermilion Energy	Oil & Gas E&P	Oil & Gas Exploration & Production	Bear	Toronto Stock Exchange	Canada, Commodity Exposure, Earnings miss, energy, exit, Oil & Gas Exploration & Production, production growth, Underperformance	Login
Jul 20, 2026	Fund Letters	Renaissance Investment Management - International Small Cap Equity	SIMO	Silicon Motion Technology	Semiconductors	Semiconductors	Bull	NASDAQ	Embedded Memory, Hong Kong, information technology, market share gains, Memory Controllers, NAND flash, Outsourcing Trend, semiconductors, Ssd, Top Contributor	Login
Jul 20, 2026	Fund Letters	Renaissance Investment Management - International Small Cap Equity	GTX	Garrett Motion	Auto Parts	Auto Parts & Equipment	Bull	NASDAQ	Auto Parts & Equipment, Automotive Transition, Consumer Discretionary, E-Powertrain, EV Slowdown, Hydrogen Fuel Cell, Internal Combustion Engine, Switzerland, Turbochargers, Zero-Emission Technologies	Login
Jul 20, 2026	Fund Letters	Renaissance Investment Management - International Small Cap Equity	MEOH	Methanex	Chemicals	Commodity Chemicals	Neutral	NASDAQ	Canada, Commodity chemicals, commodity prices, Detractor, geopolitical risk, materials, Methanol, price compression, Strait of Hormuz, supply chain	Login
Jul 20, 2026	Fund Letters	Renaissance Investment Management - International Small Cap Equity	ARIS	Aris Mining	Gold	Gold	Bull	Toronto Stock Exchange	Canada, Colombia, Commodity Exposure, Gold, growth, Marmato Mine, materials, Mining, Precious Metals, Production Ramp	Login
Jan 21, 2026	Fund Letters	Michael E. Schroer	TSEM	Tower Semiconductor Ltd.	Information Technology	Semiconductors	Bull	NASDAQ	AI, Capacity, Margins, Photonics, Rf, semiconductors	Login
Jan 21, 2026	Fund Letters	Michael E. Schroer	PSFE	Paysafe Limited	Financials	Transaction & Payment Processing Services	Bear	New York Stock Exchange	Fintech, growth, Margins, Payments, Regulation	Login
Jan 21, 2026	Fund Letters	Michael E. Schroer	ARIS CN	Aris Mining Corporation	Materials	Gold	Bull	New York Stock Exchange	deleveraging, expansion, Freecashflow, Gold, Mining	Login
Oct 21, 2025	Fund Letters	Michael E. Schroer	TSEM	Tower Semiconductor Ltd.	Information Technology	Semiconductors	Bull	NASDAQ	AI, data centers, diversification, Foundry, growth, Photonics, semiconductors	Login
Oct 21, 2025	Fund Letters	Michael E. Schroer	TSEM	Tower Semiconductor Ltd.	Information Technology	Semiconductors	Bull	NASDAQ	AI, data centers, diversification, Foundry, growth, Photonics, semiconductors	Login
Jul 21, 2025	Fund Letters	Michael E. Schroer	CLS CN	Celestica Inc.	Information Technology	Electronic Manufacturing Services	Bull	New York Stock Exchange	AI, Canada, electronics, hyperscalers, manufacturing, Networking	Login
Jul 21, 2025	Fund Letters	Michael E. Schroer	BBY LN	Balfour Beatty plc	Industrials	Construction & Engineering	Bull	New York Stock Exchange	backlog, construction, Defense, infrastructure, Projects, UK	Login

Date

Pitch Type

Author

Ticker

Company

Industry

Sub Industry

Bull / Bear

Exchange

Keywords

Action

Jul 20, 2026

Fund Letters

Renaissance Investment Management - International Small Cap Equity

TGS

Oil & Gas Equipment & Services

Bull

Oslo Bors (Oslo Stock Exchange)

backlog growth, CapEx cycle, energy, Energy security, Exploration, Marine services, Norway, Offshore Wind, Oil & Gas Equipment & Services, seismic data

Jul 20, 2026

Fund Letters

Renaissance Investment Management - International Small Cap Equity

VET

Vermilion Energy

Oil & Gas E&P

Oil & Gas Exploration & Production

Bear

Toronto Stock Exchange

Canada, Commodity Exposure, Earnings miss, energy, exit, Oil & Gas Exploration & Production, production growth, Underperformance

Jul 20, 2026

Fund Letters

Renaissance Investment Management - International Small Cap Equity

SIMO

Silicon Motion Technology

Semiconductors

Bull

NASDAQ

Embedded Memory, Hong Kong, information technology, market share gains, Memory Controllers, NAND flash, Outsourcing Trend, semiconductors, Ssd, Top Contributor

Jul 20, 2026

Fund Letters

Renaissance Investment Management - International Small Cap Equity

GTX

Garrett Motion

Auto Parts

Auto Parts & Equipment

Bull

NASDAQ

Auto Parts & Equipment, Automotive Transition, Consumer Discretionary, E-Powertrain, EV Slowdown, Hydrogen Fuel Cell, Internal Combustion Engine, Switzerland, Turbochargers, Zero-Emission Technologies

Jul 20, 2026

Fund Letters

Renaissance Investment Management - International Small Cap Equity

MEOH

Methanex

Chemicals

Commodity Chemicals

Neutral

NASDAQ

Canada, Commodity chemicals, commodity prices, Detractor, geopolitical risk, materials, Methanol, price compression, Strait of Hormuz, supply chain

Jul 20, 2026

Fund Letters

Renaissance Investment Management - International Small Cap Equity

ARIS

Aris Mining

Gold

Bull

Toronto Stock Exchange

Canada, Colombia, Commodity Exposure, Gold, growth, Marmato Mine, materials, Mining, Precious Metals, Production Ramp

Jan 21, 2026

Fund Letters

Michael E. Schroer

TSEM

Tower Semiconductor Ltd.

Information Technology

Semiconductors

Bull

NASDAQ

AI, Capacity, Margins, Photonics, Rf, semiconductors

Jan 21, 2026

Fund Letters

Michael E. Schroer

PSFE

Paysafe Limited

Financials

Transaction & Payment Processing Services

Bear

New York Stock Exchange

Fintech, growth, Margins, Payments, Regulation

Jan 21, 2026

Fund Letters

Michael E. Schroer

ARIS CN

Aris Mining Corporation

Materials

Gold

Bull

New York Stock Exchange

deleveraging, expansion, Freecashflow, Gold, Mining

Oct 21, 2025

Fund Letters

Michael E. Schroer

TSEM

Tower Semiconductor Ltd.

Information Technology

Semiconductors

Bull

NASDAQ

AI, data centers, diversification, Foundry, growth, Photonics, semiconductors

Oct 21, 2025

Fund Letters

Michael E. Schroer

TSEM

Tower Semiconductor Ltd.

Information Technology

Semiconductors

Bull

NASDAQ

AI, data centers, diversification, Foundry, growth, Photonics, semiconductors

Jul 21, 2025

Fund Letters

Michael E. Schroer

CLS CN

Celestica Inc.

Information Technology

Electronic Manufacturing Services

Bull

New York Stock Exchange

AI, Canada, electronics, hyperscalers, manufacturing, Networking

Jul 21, 2025

Fund Letters

Michael E. Schroer

BBY LN

Balfour Beatty plc

Industrials

Construction & Engineering

Bull

New York Stock Exchange

backlog, construction, Defense, infrastructure, Projects, UK

TICKER	COMMENTARY
SIMO	The top contributor to our performance during the quarter was Silicon Motion Technology (Hong Kong). The company is benefiting from an unusual dynamic in the NAND supply chain, in which constrained memory makers are increasingly outsourcing controller development to Silicon Motion rather than internally. This is driving share gains in embedded eMMC/UFS and client SSDs that are more than offsetting broader unit declines in smartphones and PCs.
GTX	Another strong performer during the quarter was Garrett Motion (Switzerland). Slower market penetration for electric vehicles, particularly in the United States, is helping improve sentiment for the company's traditional internal combustion engine turbocharger business while prospects are growing for its zero-emission technologies segment, which includes hydrogen fuel cell compressors, e-powertrains, and e-cooling compressors.
MEOH	The largest detractor from performance was Methanex (Canada), as the reopening of the Strait of Hormuz, through which one-third of the world's methanol passes, caused methanol prices to drop back to near pre-war levels.
VET	Conversely, we sold Vermilion Energy (Canada) after the exploration and production company reported first quarter results that fell short of analyst expectations, causing an initial sell off. With limited near-term production growth catalysts, the stock is largely trading on oil and commodity price movements, which led us to exit our position during the quarter.

TICKER

COMMENTARY

SIMO

The top contributor to our performance during the quarter was Silicon Motion Technology (Hong Kong). The company is benefiting from an unusual dynamic in the NAND supply chain, in which constrained memory makers are increasingly outsourcing controller development to Silicon Motion rather than internally. This is driving share gains in embedded eMMC/UFS and client SSDs that are more than offsetting broader unit declines in smartphones and PCs.

GTX

Another strong performer during the quarter was Garrett Motion (Switzerland). Slower market penetration for electric vehicles, particularly in the United States, is helping improve sentiment for the company's traditional internal combustion engine turbocharger business while prospects are growing for its zero-emission technologies segment, which includes hydrogen fuel cell compressors, e-powertrains, and e-cooling compressors.

MEOH

The largest detractor from performance was Methanex (Canada), as the reopening of the Strait of Hormuz, through which one-third of the world's methanol passes, caused methanol prices to drop back to near pre-war levels.

VET

Conversely, we sold Vermilion Energy (Canada) after the exploration and production company reported first quarter results that fell short of analyst expectations, causing an initial sell off. With limited near-term production growth catalysts, the stock is largely trading on oil and commodity price movements, which led us to exit our position during the quarter.

Ticker	Put/Call	Amount Bought	Shares Bought	% Change	Weight %
No Recent Buys Data

Ticker

Put/Call

Amount Bought

Shares Bought

% Change

Weight %

No Recent Buys Data

Ticker	Put/Call	Amount Sold	Shares Sold	% Change	Weight %	Status
No Recent Sells Data

Ticker

Put/Call

Amount Sold

Shares Sold

% Change

Weight %

Status

No Recent Sells Data

Industry	Prev Quarter %	Current Quarter %	Change
No industry data available

Industry

Prev Quarter %

Current Quarter %

Change

No industry data available

Investment Summary

Investor Summary

Fund Strategy

FUND PERFORMANCE AS OF 30th June 2026

Investor Letters

Latest Executive Summary:

Executive Summary

Core Thesis

Forward Outlook

Investment Themes

Semiconductor Cycle

Energy

China

Electric Vehicles

Gold

Dollar

Value

Energy

AI

China

Trade Policy

Commercial Real Estate

Behavioral Finance

Value

Growth

AI

China

Trade Policy

Europe

Trade Policy

Dollar

Infrastructure Spending

AI

Trade Policy

Infrastructure Spending

China

Trade Policy

China

Europe

Investor Pitches

Current Portfolio as of ( 30th June 2026 )

Key Risks identified by Manager:

Key catalysts include:

Portfolio Implications

Ticker Commentary

Michael E. Schroer Top Holdings

Recent Buys (13F)

Recent Sells (13F)

13F Sector Summary

Portfolio Distribution

Latest 13D & 13G Filings

Join for free and get access to the buyside

Get insights from the world's most influential hedge fund investors direct to your inbox

Follow Us On:

Subscribe to receive email notification and updates for:

Renaissance Investment Management – International Small Cap Equity