Starseed Growth Value Fund

StarSeed Growth Value Fund employs a barbell strategy that blends both growth and value stocks to achieve portfolio stability and superior returns. The fund’s approach is grounded in rigorous top-down and bottom-up analysis, ensuring objective evaluation through financial statements and corporate value metrics. Investment weightings are flexibly adjusted across sectors and stock types, reflecting changes in global financial conditions and market environments. This dynamic allocation aims to deliver high yields with lower volatility compared to the broader market.

The concept of governance is central to the strategy, encompassing the rules and relationships that define authority, responsibility, and rewards among stakeholders. Excellent governance is recognized as a fundamental driver of competitive advantage and investment returns. The fund seeks to promote corporate value and shareholder profit maximization by encouraging company-friendly changes, rather than just exercising shareholder rights.

The Korean stock market is highlighted as one of the most undervalued globally, with notably low P/B and P/E ratios compared to the US, Europe, Japan, and Taiwan. This “Korea Discount” is attributed to poor capital efficiency and low shareholder returns, exacerbated by high inheritance and dividend income tax rates.

The fund attempts to create value by opportunistically investing in such Korean businesses which transition from hostile takeovers, shareholder activism and possible rerating driven by Government policy towards corporate governance reforms.

The fund also capitalizes on Korea’s highly liquid public equity market, which presents 80 to 140 IPO opportunities annually, offering significant return potential. Financial institutions and funds can secure larger IPO allocations than individual investors, enhancing the fund’s access to new listings. Systematic corporate analysis and scenario simulation are used to maximize investment success rates, with a 96% success rate in profitable IPO exits. The fund’s strategy aims to minimize market correlation (beta) and maximize absolute returns (alpha) through selective IPO participation.

The fund also relies on deep fundamental research to invest in high conviction ideas in the US market which provides access to innovative, globally dominant companies across technology, healthcare, consumer, and financial sectors based on fair and most strongly aligned governance with shareholder value.

‍The fund’s performance has consistently outperformed the S&P500 and KOSPI 200 benchmark, with notable monthly and annual returns. The approach is supported by a team with deep legal and financial expertise, enabling sophisticated analysis of governance events and legal disputes. Ultimately, the fund’s strategy leverages undervaluation, governance improvement, and IPO opportunities to deliver superior risk-adjusted returns to investors.