Skip to main content
Your browser is not up to date. We encourage you to change or update your browser to ensure the best possible experience on our site.
Login

ABOUT THE L1 CAPITAL INTERNATIONAL STRATEGY

From 1 October 2025, L1 Capital International has become the sub-investment adviser for the Platinum International Fund and the Platinum Global Fund (Long Only). The Platinum International Fund is the “Underlying Fund” of the Platinum International Fund Active ETF. From that date, both the Platinum International Fund and the Platinum Global Fund (Long Only) will follow the same investment approach as the L1 Capital International strategy – a strategy that has been led by David Steinthal, the Chief Investment Officer of L1 Capital International, since he launched it in Sydney in 2019. If you would like to learn more about David’s track record, you can visit www.L1.com.au/investments/l1-capital-international-fund.

How we Invest

The L1 Capital International strategy is about investing with conviction. We look to own a select group of high-quality businesses around the world – companies with strong cashflows, operating in industries we believe are well positioned for the future. Our team digs deep into each business, combining detailed research with a focus on managing risk, so that we can deliver attractive long-term returns while aiming to protect investors from permanent losses.

Each portfolio usually holds around 25 companies. That means we can focus only on businesses we think are truly exceptional investments. We’re not tied to labels like “growth” or “value”, and we’re open to opportunities in companies of all sizes, provided they meet our quality standards.

L1 International Philosophy L1 International Investment Approach & Process L1 Capital’s Stewardship

INVESTMENT PHILOSOPHY

L1 International Philosophy

At L1 Capital International, we believe long-term returns come from owning businesses that combine quality with value.

To us, “quality” means companies that have strong fundamentals: they operate in attractive industries, are run by capable and aligned management teams, are financially strong and maintain responsible and sustainable practices from an ESG perspective.

When it comes to “value”, we focus on the real economics of a business – its cashflow, earnings, and returns on the money it invests – not just accounting profits. Our approach is based on conservative assumptions, because what matters is not just today’s price tag, but how a company performs over time.

The types of businesses we look to invest in are those that we believe:

  • Have durable business models and operate in well-structured industries
  • Are run by managers who invest wisely and think like owners
  • Generate healthy cashflows and can reinvest for growth or return capital to shareholders
  • Maintain solid balance sheets and manage risk carefully
  • Operate responsibly, with practices that support long-term sustainability i.e. that are strong on the Environmental Social and Governance (ESG) front.

L1 International Investment Approach and Process

Our research process brings together the two key requirements of quality and value. Only businesses that meet both standards earn a place in the portfolio. We draw our investment ideas from in-depth research and in-person conversations with company management around the globe.

When we assess a company, we look closely at five areas:

  • Business drivers – what really drives a firm’s cashflow, revenue, margins and profits, and how sustainable those drivers are.
  • Industry structure – how competitive the industry is, how much room there is to grow, and what risks (like new technology or regulation) might arise.
  • Financial strength – companies with pricing power, strong margins, predictable cashflows, and limited financial risk stand out to us.
  • Management – we want leaders with a proven track record of good decisions, smart capital allocation and skin in the game.
  • ESG – we believe responsible and sustainable ESG practices are key to long-term success. 

We give each company we research a Quality Rating on our six-point scale:

  • 1 – Excellent: outstanding across all categories, the kind of business we want to own for the long haul.
  • 2 – Very good: strong overall, with only minor areas for improvement.
  • 3 – Good: above average, with solid fundamentals but perhaps not as exceptional as a 1 or 2.
  • 4 – Average: acceptable quality but not compelling enough unless the valuation is very attractive.
  • 5 – Below average: weak in several respects, and unlikely to make it into the portfolio.
  • 6 – Poor: significantly deficient and automatically excluded.

We only invest in companies that we rate 1, 2 or 3 – meaning they pass a high bar for quality and they also need to meet our valuation test. If a company looks promising on quality but is too expensive today, it may go onto our “bench” of closely watched businesses until the price becomes attractive.

From there, we build a portfolio of 20–40 stocks, usually holding around 25 at any one time. Each company typically makes up 2–7% of the portfolio, sized according to the risk it adds, not just the potential return. The portfolio is focused mainly on developed markets in around the world. While we generally stay fully invested (less than 5% in cash), we can hold up to 25% cash if equity assets look excessively risky.

Responsible Investing Approach

L1 Capital's Stewardship

Responsible Investing Approach

L1 Capital International believes responsible investing goes hand in hand with long-term value creation. That’s why environmental, social and governance (ESG) considerations are built into our investment process. Just like we do for financial, quality and valuation aspects, we form our own independent view of every company’s ESG practices rather than relying on outside ratings.

To keep things simple and consistent, we give each company an ESG score on a six-point scale:

  • 1 – Excellent: industry-leading or best practice
  • 2 – Very good: better than average in most respects
  • 3 – Good: better than average in some areas
  • 4 – Average: broadly in line with peers
  • 5 – Below average: weaker than most
  • 6 – Poor: lagging behind industry standards

These ESG ratings are not a standalone exercise – they feed directly into our overall Quality Rating framework, which assesses a business across multiple dimensions. For a company to make it into the portfolio, it must score at least a 4 (“Average”) or better on ESG, and achieve a Quality Rating of 1, 2 or 3.

This dual requirement means two things:

  • We exclude poor performers – companies with subpar ESG practices don’t make it into our investable universe, even if they otherwise look attractive.
  • We demand balance – a business that does well on ESG but falls short on other key quality factors is also ruled out.

In short, we invest in businesses that not only create shareholder value but have good governance and operate in a way that’s sustainable and responsible.