Seafarer®

Pursuing Lasting Progress in Emerging Markets™

Letter to Shareholders – Semi-annual Report

Lanzhou, China

November 2018 – Andrew Foster explains that despite unsatisfactory performance, he believes the emerging markets still warrant long-term investment, chiefly because of their potential to decouple from the investment cycle of the developed world. Andrew asserts that current U.S. trade policy will push China toward greater economic independence, and the pace of transformation will likely surprise observers. When the transition is complete, the emerging markets will follow a new and differentiated investment cycle, with China at their center.

Letter to Shareholders

Seafarer Overseas Growth and Income Fund Portfolio Review – Third Quarter 2018

Mexico City, Mexico

November 2018 – Andrew Foster notes that several Growth and Income Fund holdings rebounded during the quarter, and the Fund largely sidestepped a correction in Chinese technology stocks. He describes the impact of the Fund’s restructuring on the portfolio composition. Lastly, Andrew observes that conditions in the emerging markets are materially better than they might appear, but secondary effects from U.S. tariffs on China present a critical risk.

Portfolio Review

Seafarer Overseas Value Fund Portfolio Review – Third Quarter 2018

Guangzhou, China

October 2018 – Paul Espinosa explains how the extension of price discovery related to the trade dispute between the U.S. and China – from companies directly impacted by tariffs to companies indirectly affected – has impacted the performance of various Value Fund holdings. He also discusses the Fund’s deployment of cash during a period of pressure on the prices of emerging market equities, as well as the addition of one new portfolio holding.

Portfolio Review

News and Commentary

Seafarer Overseas Growth and Income Fund Message to Shareholders – SIGIX to Re-open

Effective November 19, 2018, the Growth and Income Fund’s Institutional Class (SIGIX) will re-open to new investors. The Fund’s Investor Class (SFGIX) will remain closed to most new investors. View the Message to Shareholders.

China’s Indebted Residential Property Development Sector

– As the Chinese government pledges “unwavering” support for private sector enterprises, will the highly-indebted residential property development sector receive government support?

White Paper China’s Tech Rush – How the Country’s Strategic Technology Campaign is Shaping Markets

– China’s campaign to advance its technological capabilities has the potential to transform many emerging high-tech industries through an unprecedented level of government support and cooperation with the private sector.

Prevailing Winds

China’s Private Sector is Feeling the Pinch

– While new government policies in China may ease the financing challenges faced by the private sector, truly leveling the playing field between private and state-owned enterprises will require structural reforms and take years to implement.

How Artificial Intelligence is Shaping Industries Across China

– China has rapidly emerged as a world-class innovator in the field of artificial intelligence and is at the forefront of applying AI to solve real world business problems.

The Prevailing Winds blog by Nicholas Borst tracks economic and financial developments shaping China. Learn more.