We seek to profit from inefficiencies in emerging and frontier markets to generate returns for clients using a rigorous, bottom-up stockpicking process combined with disciplined risk management and portfolio construction.
We are stock pickers: our aim is to identify well-managed companies, with robust business models where shareholder interests are respected, that can generate attractive returns on invested capital as well as sustainable growth in earnings and cashflow.
These company characteristics are not always appropriately valued in emerging markets, which often price stocks on short-term or thematic considerations. Experience shows that we can generate attractive long-term portfolio returns though a patient, high-conviction, research-driven approach to stock selection.
We build concentrated, growth-orientated portfolios with an emphasis on quality. Stocks are selected on the basis of their risk-adjusted upside potential with position sizes driven by conviction, not by the market index. Our portfolios can have sizeable deviations from the index at both country and sector levels.
Low portfolio turnover and long holding periods are standard as we identify stocks that profit from multi-year structural developments. Periods of short-term market volatility may generate opportunities to add or reduce position sizes or be an entry or exit point for portfolio positions. We invest across the capitalization spectrum, as well as in off-benchmark markets and stocks. The key emphasis is on quality – holdings typically exhibit effective managements, high returns on capital and strong cashflow generation.
The foundation of our investment process is thorough, on-the-ground, qualitative research and disciplined, price-focused financial modelling. The diversity, experience and expertise of our investment team, working together under a common process, are key strengths.