Spotlight on Andrew Gowen, Portfolio Manager & Director of Research, Bell Asset Management
Global Thought Leader Spotlight
Andrew Gowen, Portfolio Manager & Director of Research, Bell Asset Management
Dual roles, single focus
My role at Bell spans both investment research and portfolio management, which enhances cross functional communication and ensures consistent execution throughout the investment process.
In my capacity as Director of Research, I’m responsible for Bell's investment research function, which involves overseeing the firm's team of investment research professionals globally. I ensure workflows are prioritised appropriately in alignment with the opportunity set and that a cohesive research process is maintained to diligently implement our investment framework.
My responsibilities as a Portfolio Manager encompass the management of both the broader global equities portfolio and the High Conviction portfolio.
Bell Asset Management is a global equity manager investing in the highest quality investment opportunities via a rigorous, fundamental, bottom-up research process. Our approach is unconstrained by geography and industry, and we invest across the market capitalisation spectrum in pursuit of the best investment opportunities for our clients’ portfolios. We are long-term oriented in both our approach to investing and the partnerships we build with our clients.
Global SMID caps: An opportunity to capitalise
Global small and medium cap equities are moving out of the shadow of large caps and gaining the attention of investors seeking growth and diversification.
Growth potential & outperformance: A persistent long-term trend in global equities is the structural outperformance of global small and mid cap equities (global SMID caps) over their large cap counterparts.
Over the 25-year period from 2000 to 2025, a $100,000 investment in global SMID caps would have yielded $582,000 (7.3% pa), while the same investment into large caps would have yielded $438,000 (6.1% pa). These superior returns are principally driven by higher growth, as global SMID caps are typically in earlier stages of their business lifecycle. A strong entrepreneurial drive and greater agility often leads them to be disruptors and share gainers. And they benefit from a longer growth runway, allowing for the powerful compounding effect of growth on a smaller base.
Looking back across 5, 10, and 15-year time horizons, we can see that global SMID caps have demonstrated faster revenue and earnings per share (EPS) growth compared to more mature, large cap firms.
Trading at a discount…making it a timely investment: A recent dislocation provides a compelling opportunity to capitalise on global SMID caps. They have underperformed large caps for most of 2023 and 2024, as their earnings were slower to reaccelerate following a period of market stress in 2022.
Our perspective is that this "growth hiatus" has created a material and divergent valuation gap. The P/E multiple of the MSCI World SMID Cap Index now trades at a 15% discount to the MSCI World Large Cap Index, a sharp reversal from its 10-year average premium of 4%.
We believe this dislocation is likely to be temporary, as consensus forecasts indicate global SMID caps earnings growth is set to reaccelerate and surpass that of large caps. For 2026, SMID caps EPS growth is estimated at 16.8% versus only 10.5% for large caps. And we have already seen evidence of this with global SMID caps matching the performance of large caps in 2025.
For institutional investors, these developments have clear implications for portfolio construction.
A strategic allocation to global SMID caps allows portfolios to capture superior long-term growth and benefit from a potential valuation re-rating as the current discount normalises toward its historic average.
Genuine diversification: Furthermore, investing in global SMID caps is a powerful tool to mitigate the growing concentration risk within traditional large-cap indices. In the Global Large Cap index just two sectors (Information Technology and Financials) make up 46% of the index, while the top 10 stocks account for 30% of its weight.
An allocation to global SMID caps provides crucial geographic and sector diversification, reducing a portfolio's susceptibility to single-stock risk and the "passive flow" risk, where large inflows disproportionately inflate valuations of the largest index members.
Hidden gems: In terms of implementation, we believe the active capital allocation has a greater potential to maximise the opportunity. Global SMID caps receive significantly less research coverage from sell-side analysts and has lower institutional ownership. This creates a fertile hunting ground for active managers to generate alpha by identifying mispriced, high-quality companies.
Andrew will be presenting at Global Investment Institute’s upcoming Equities Investment Forum, taking place on Wednesday, 10 September 2025 in Melbourne CBD, Victoria. To register your interest in attending, click here or for more information email zlatan@globalii.com.au.
Andrew Gowen, Portfolio Manager & Director of Research, Bell Asset Management
Andrew has strong research acumen, honed over 25 years working in global equities across the UK and US, including more than 15 years as a portfolio manager.
His most recent role was Portfolio Manager at Lombard Odier, where he co-managed the long-term outperforming World Brands fund (c.$1bn USD) and the 1798 Global Consumer portfolio, with a focus on high quality, growth stocks in the Consumer and Technology sectors.
Previous roles include: Portfolio Manager, Global Equities, at Balyasny Asset Management L.P; Head of Europe Consumer, Equities, at Och-Ziff Capital Management; Senior Vice President at Lazard Asset Management; and Executive Director at Lehman Brothers.
With a proven track record of providing high alpha, Andrew brings with him a global network of meaningful relationships with leading CEOs, and proven leadership in driving research excellence and building high-performing teams.
Andrew is a Chartered Financial Analyst, Associate of the Institute of Investment Management & Research, and has a Bachelor of Commerce (Finance and Accounting), and a Bachelor of Laws with First Class Honours.
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