Cartica Management, LLC (“Cartica”) is a concentrated, “active owner” in small and mid-cap publicly-traded companies in the emerging markets and has a constructive outlook for these stocks. “Whereas most developed economies may have limited remaining dry powder to stimulate slowing economies, emerging economies have substantial headroom in terms of both fiscal and monetary policy,” says Teresa Barger, Co-Founder and CEO of Cartica. “And small and mid-caps have to some extent been orphans in a bull market narrowly led by a handful of, mainly technology-oriented, mega-cap stocks that come under the umbrella of growth and momentum factor investing.” She continues that, “Value investing has also been something of a Cinderella. The most crowded trade is market cap weighted indices and the S&P 500 is the most crowded trade of all. As of October 2019, emerging market mid-caps have underperformed for nearly three years and are lagging the Emerging All-Cap Index by two standard deviations. We expect some mean reversion.” The firm defines mid-caps using the MSCI EM parameters, with a maximum market cap at the time of initial investment of $9bn. The median market cap for Cartica’s portfolio is around US$4bn.