International Equity

For wealth managers

Parametric's International Equity Strategy is designed to efficiently capture the long-term returns of developed international equity markets while avoiding both the return risks of active management and the concentration risks of mainstream international equity indexes.

International Equity seeks to outperform the MSCI EAFE Index over three to five years. We use a top-down process to reweight the portfolio at three levels with the goal of reducing concentration risk. Reweighted country and sector allocations, broadly diversified individual holdings, and disciplined rebalancing are central to this investment approach. Our transparent and repeatable process helps clients better understand their holdings.

Investing in an equity strategy involves risk. All investments are subject to loss. Learn more.

RISK CONSIDERATIONS:

All investment and trading activities risk the loss of capital, and no assurance can be given that the investment activities of a client’s account will achieve the investment objectives of such account or avoid losses. Direct and indirect investing in securities involve risk of loss that clients should be prepared to bear. Past performance is not indicative of future results. All information provided has been prepared solely for informational purposes and does not constitute an offer or a recommendation to buy or sell any particular security or to adopt any specific investment strategy.

There is no assurance that a separately managed account (SMA) will achieve its investment objective. SMAs are subject to market risk, which is the possibility that the market values of the securities in an account will decline and that the value of the securities may therefore be less than what you paid for them. Market values can change daily due to economic and other events (e.g., natural disasters, health crises, terrorism, conflicts, and social unrest) that affect markets, countries, companies, or governments. It is difficult to predict the timing, duration, and potential adverse effects (e.g., portfolio liquidity) of events. Accordingly, you can lose money investing in an SMA.

Diversification does not protect you against a loss in a particular market; however, it allows you to spread that risk across various asset classes.

The MSCI EAFE Index (Europe, Australasia, Far East) is a free float-adjusted market capitalization index that is designed to measure the equity market performance of developed markets, excluding the US and Canada.

It is not possible to invest directly in an index. Indexes are unmanaged and do not reflect the deduction of expenses, fees, and other expenses. Any index referred to herein is the intellectual property (including registered trademarks) of the applicable licensor. Any product based on an index is in no way sponsored, endorsed, sold, or promoted by the applicable licensor, and it shall not have any liability with respect thereto.

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Why choose Parametric?

$475.1B+

Total firm AUM

191

Investment professionals

30+

Years of equity experience

As of 12/31/2023

How it works

Country reweighting
Sector reweighting
Beta filters
Rebalancing

We weight countries equally within tiers defined by size and liquidity constraints, reducing concentration of the largest countries and overweighting smaller ones.

Once a country target exposure is determined, we set sector target weights in each country in an attempt to move closer to an equal representation from each economic sector while taking practical liquidity considerations into account.

We screen out high-beta names within each country-sector combination in favor of low-beta combinations. The result is a broadly diversified portfolio of 800 to 1,200 names.

Over time, we systematically rebalance the portfolio, bringing exposures back in line with target weights and redeploying capital into underweight areas.

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