January 2014 –
In his portfolio review, Andrew Foster discusses the various
challenges facing emerging markets:
political unrest; currency volatility; and economic uncertainty in China.
He states that the moniker “fragile five”
(a label appended to five countries deemed susceptible to currency depreciation)
is superficial, but he also notes that
panic has been on the rise.
Andrew asserts that the primary risk facing emerging markets
stems from China,
and the possibility that a default there will have cascading consequences.
Nevertheless,
he believes the Fund’s strategy
is reasonably well prepared for financial distress, and that valuations are favorable.
November 2013 –
In his address to shareholders, Andrew Foster discusses the
lackluster performance
of the emerging markets this year. He suggests that
time and perspective
are essential to put the markets in proper context:
important structural changes
are underway, but progress is difficult to perceive – change proceeds slowly, in fits and starts.
Andrew concludes with a discussion of
“WYSIATI,”
an acronym coined by Daniel Kahneman.
WYSIATI describes a fallacy that impairs decision-making,
and Andrew believes it is relevant to investors:
prevailing indices used to track emerging markets
might obscure
as much as they reveal.
Andrew suggests time and perspective are required to overcome any WYSIATI perception bias.
The Fund seeks to provide long-term capital appreciation
along with some current income; it also seeks to mitigate
adverse volatility in returns.
Strategy
The Fund invests primarily in the securities of companies located in developing countries. The Fund invests in several asset classes including dividend-paying common stocks, preferred stocks, convertible bonds, and fixed-income securities.
More...
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Morningstar profiles Andrew Foster and other portfolio managers who are tackling the challenges of investing internationally.
Morningstar: Emerging Markets – Great Potential for the Patient
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In an interview with Morningstar, Andrew Foster addresses the important structural changes underway as the emerging markets transition from an export-led to a service-led economic model.
Field Notes: Mumbai
–
While India still faces deep structural problems, I am encouraged to see that the country is swiftly dismantling the controls that impede the foreign flow of capital.
Shareholder Conference Call
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The Shareholder Conference Call offered a discussion of structural changes underway in the developing world and an examination of how prevailing indices might fail to capture those shifts.
View the
presentation and summary notes.
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News and Commentary
Morningstar: Frequent Fliers
– Morningstar profiles Andrew Foster and other portfolio managers who are tackling the challenges of investing internationally.
Morningstar: Emerging Markets – Great Potential for the Patient
– In an interview with Morningstar, Andrew Foster addresses the important structural changes underway as the emerging markets transition from an export-led to a service-led economic model.
Field Notes: Mumbai
– While India still faces deep structural problems, I am encouraged to see that the country is swiftly dismantling the controls that impede the foreign flow of capital.
Shareholder Conference Call