Letters to Shareholders are included in the Seafarer Funds’ Annual and Semi-annual Reports.
The Reports are available in the Archives.
November 2018 – Semi-annual Report
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.
Andrew Foster offers a
on recent events in China, within the context of the country’s long-term evolution.
Andrew explains that when Xi Jinping assumed the Presidency in 2012, his administration presented a
to undertake economic reform and unlock new growth potential.
However, the plan has
over the past five years: reform has largely stalled while Xi consolidated political power.
Meanwhile, the economy has remained reliant on excessive credit expansion to stimulate growth.
expresses concern as to whether China will reach its potential.
May 2017 – Annual Report
In the Annual Report letter, Andrew Foster notes the Growth and Income Fund’s
reduction in operating expenses,
consistent with Seafarer’s long-term goals. Next, he discusses Seafarer’s
policy on corporate governance.
The policy emphasizes the use of objective data to measure each company’s
impact on society and nature,
and it requires that Seafarer assess the consequences for valuation and growth.
Andrew explains how the policy favors engagement over divestment:
Seafarer believes that acting as a responsible steward of capital means encouraging companies to enhance their standards and practices.
Lastly, he declares that the policy is not a marketing gimmick, but rather an
intrinsic element of the firm’s philosophy and process.
November 2016 – Semi-annual Report
In his address to shareholders, Andrew Foster reviews recent developments with the Funds and the Adviser.
He discusses the launch of the Seafarer Overseas Value Fund,
noting that its strategy is focused on a traditional form of value investing – adapted for the particular challenges inherent to the emerging markets – and as such it embodies an evolution in Seafarer’s investment philosophy.
Andrew also addresses the recent closure of the Growth and Income Fund to most new investors,
and the intention behind the closure – to ensure that the Fund has adequate capacity to serve existing shareholders’ needs, both in the present and in the future.
In his address to shareholders, Andrew Foster discusses the performance of the Seafarer Overseas Growth and Income Fund during the fiscal year,
which is perhaps best described as
“a tale of two halves.”
He reflects on recent events within China,
and urges investors to carefully observe the country’s economic transition,
regardless of their views about the country’s investment merit.
Next, Andrew provides data on the
three-year performance record of the Fund,
and places that record in some context versus the Fund’s stated investment objectives.
He concludes by introducing Seafarer’s efforts to embrace
new modes of communication with existing and prospective shareholders.
In his address to shareholders, Andrew Foster discusses the
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
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
as much as they reveal.
Andrew suggests time and perspective are required to overcome any WYSIATI perception bias.
May 2013 – Annual Report
In his address to shareholders, Andrew Foster offers a
on the Seafarer Overseas Growth and Income Fund's performance over its first complete fiscal year. He then discusses
the merits of Seafarer's investment approach, which is practiced
“from the bottom up.”
He concludes with a brief outlook for the emerging markets. A number of major “macro”
issues may cloud the picture (as always), but Andrew believes there are plenty of
prospective investments that satisfy the risk and return criteria the Fund seeks,
and thus he is an enthusiastic investor.
November 2012 – Semi-annual Report
In his semi-annual address to shareholders, Andrew Foster discusses several topics,
beginning with valuations in emerging markets, which he describes as
broadly fair. Next, he offers his
thoughts on changes in China’s growth model and
how the service sector is likely to be at the forefront of the transition.
Andrew notes, however, two areas where China may falter:
he’s worried about the possibility of military conflict, but he’s even more
concerned about the country’s leadership. He sees some signs that it is
growing more ideologically rigid at a time when flexibility is paramount.
Lastly, Andrew offers a few comments about
Seafarer’s progress to date.
May 2012 – Annual Report
In Seafarer’s inaugural letter to shareholders, Lead Portfolio Manager Andrew Foster discusses his outlook for the Seafarer Overseas Growth and Income Fund; his views on China’s slowing growth and Europe’s woes; valuations on emerging market stocks; the importance of perspective and persistence amid today’s frenetic markets; and his goals for Seafarer and the Fund.
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