Schroders has announced the launch of a new fund focused on achieving capital growth through investing in smaller companies in emerging markets and Asia.

The Schroders Small Cap Discovery fund, managed by Matthew Dobbs, will have a portfolio of between 70 and 100 stocks and will be placed in the IMA Global sector.

Dobbs is currently head of global and international small-cap equities at Schroders, in addition to managing the firm’s Pacific Equity portfolios such as the Asian Alpha Plus fund and the Asia Pacific and Oriental Income investment trusts.

According to figures from financial services website FE Trustnet, Dobbs has outperformed his peer group in seven out of the last ten years, with the three years of underperformance between 2006 and 2008. Over the last ten years, his funds have returned 70 per cent more than his peer group.

Dobbs commented, ‘Smaller companies in emerging markets and Asian regions are an increasingly attractive opportunity set, providing higher exposure to some of the most interesting themes such as consumer cyclicals, industrials and healthcare.

‘The number of potential smaller companies in emerging markets has risen substantially over the last decade, deepening the investment universe and enhancing the opportunity set.’

Robin Stoakley, managing director of UK intermediary at Schroders, added, ‘We’re very excited to be launching this “discovery” fund, which is complementary to investors who have exposure to smaller companies in developed markets.

‘Small Cap Discovery is designed for investors seeking attractive new areas of growth and alpha generation – perfect for this current environment.’

While the fund will focus on small-caps in the emerging markets and Asia excluding Japan regions, it has scope to invest in companies domiciled elsewhere but with a significant portion of their business in those regions.