Big Ideas, Small Stocks

% www.barrons.com THE DOW JONES BUSINESS AND FINANCIAL WEEKLY OCTOBER 2, 2017 Talking With Amy Zhang

Amy Zhang’s introduction to investing came in the form of C++ computer code. As a math and computer science major at Manhattanville College in Harrison, N.Y., Zhang interned at a wealth management firm, debugging a program. The experi- ence piqued her interest in finance. “It was totally new to me—it requires constant learning,” says Zhang, who was born and raised in Shanghai and moved to the U.S. at age 17 after receiving a scholarship to a private high school in New Mexico. Inspired by the internship, Zhang changed her major to economics, with a concentration in finance. She completed her undergraduate studies in three years, and was accepted into multiple Ph.D. pro- grams and Columbia Business School; she decided to go for the M.B.A., though she deferred her studies for two years to work as a fixed-income analyst. “I gravitate to- ward complexity,” she says. “I like to take complex things and break them down.” For the past 15 years, Zhang, now 46, has channeled that skill into finding and vetting small, growing companies. In early 2015, she took over Alger Small Cap Fo- cus (ticker: AOFAX) and retooled the fund, which had $14 million in assets, to create a concentrated portfolio of some 50 compa- nies with less than $500 million in revenue when she invests. (She considers revenue a better gauge of size than market value.) The now $537 million fund has returned an average of 10.9% a year over Zhang’s tenure, better than the 8.7% for the Russell 2000 Growth index. It has beaten 83% of its Portfolio Manager, Alger Small Cap Focu Big Ideas In Small Stocks by Sarah Max Ideas, tocks Portfolio Manager, Alger Small Cap Foc Big Ideas In Small Stock by Sarah Max Talking Wi Amy Zhan Po tfolio M nager, Big I mall by Sarah Max Talking With Amy Zhang

Amy Zhang of Alger Small Cap Focus looks more at revenue than at market value.

Laura Barisonzi for Barron’s

Amy Zhang of Alger Small Cap Focus looks more at revenue than at market value.

Amy Zhang of Alger Small Cap Focus looks more at revenue than at market value.

Laura Barisonzi for Barron’s

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