Portfolio Review – Fourth Quarter 2013

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.

Portfolio Review

Letter to Shareholders – Semi-Annual Report

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.

Letter to Shareholders

Seafarer Overseas Growth and Income Fund

Investment Objective

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...

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

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.

Seafarer Fund

SFGIX(Investor) $11.54 –$0.13
SIGIX(Institutional) $11.55 –$0.12

Shareholder Updates

Fund Resources