All investment decisions are based on proprietary research and a five-year model of projected growth for target companies. This obliges each analyst to do in-depth qualitative and quantitative checks before even putting forward a stock for in-house consideration.

'They have to make sure the numbers work and the whole team will have to sign off before a stock is put on the internal 'bargain list' from which portfolio managers can make their picks,' Mr Chang said.

That team consists of 34 analysts around the world who 'meet' twice weekly through teleconferencing. They discuss the merits of suggested additions to the bargain list and examine the logic and long-term viability of each proposal.

'It is a collective effort and a very vigorous process. It ensures some sort of consistency and means that clients are getting the benefits of 34 analysts not just one.'

He said that during the IT bubble the firm came under pressure to modify its focus on inherent value and sound fundamentals, but had resisted.

'At that time we were comparatively lagging, but bit the bullet, stuck to the five-year forecast and came out quite alright,' he said. 'The first measure is performance - you can't shy away from that - but some people are rather short-sighted. What you have to deliver is consistent long-term performance based on risk-adjusted returns.'

He said that when evaluating a company the research should include discussions with management, staff, competitors, suppliers and clients. This was part of a series of checks and balances to see if the forward strategy made complete sense and provided a chance to do some extra benchmarking.

'The process is no different for the smaller companies. But we may have to dig a little bit deeper as there may not be so much data publicly available.'

That has particular relevance for the firm's new emerging market smaller companies fund. It is being launched as an initial public offering in Hong Kong and will subsequently be sold globally, excluding the US. The objective is to achieve long-term appreciation through investing in companies with a market capitalisation of less than US$1billion. The focus will be on 13 worldwide emerging markets, including Brazil, Poland, India and China and, based on the model weighting, 40 to 50 per cent of the funds raised will be allocated to markets in Asia.

Mr Chang gave an indication of potential returns by stating that for the three years to August 2007 the MSCI Emerging Markets Index, consisting mainly of large and mid-sized companies, was up 164 per cent. Over the same period, the Merrill Lynch Emerging Markets Small Cap Index recorded growth of 312 per cent.

'That is historical. But we see emerging markets as a big theme and expect superior growth to be driven by better corporate governance, a bigger affluent class and higher internal consumption in these economies,' he said.

He said the idea for such a fund had been kicking around for some time but had been given the go-ahead for two reasons. The firm felt it could now achieve sustained growth over the long term, taking due consideration of the usual political and economic vagaries. And it was seen as a chance to play the role of pioneer.

'From design to launch it didn't take long to see the benefits.'

The initial feedback to product training conducted for distributors, banks and insurance companies in the past few weeks has been positive. 'I think our reputation as an investor in emerging markets for 20 years really helps. People want to talk to us.'

However, he added a word of caution. The fund, by its nature, would carry a higher level of risk and should therefore be held as a long-term investment in a portfolio constructed with diversity in mind.

He said the firm would have one or two more funds to launch in the next 12 months with a view to filling perceived gaps in the market. This could mean an additional focus on the Middle East or South Africa which, broadly speaking, fund managers still tended to regard as 'frontier areas'.

'[The funds] could offer a chance to play to our strengths and apply the bottom-up philosophy,' Mr Chang said.