The Italian stock market is concentrated in financial companies and public utilities. Add ENI in Energy, Luxottica and others consumer stocks and you have three quarters of the market. As a result, an investor who buys an Italy ETF, or an Italian Equities fund benchmarked around the index, is buying those few sectors and therefore dramatically underinvesting in what is the backbone of the Italian economy – small companies.
The Made in Italy Fund concentrates only on small caps – companies with a market capitalization below one billion euro. They are 80% of the quoted names, but less than 10% of total market value.
The Fund’s objective is to select the best 30 companies within that universe, in terms of profitability, growth and valuation.