Emerging Markets Equity Investing
The Emerging Markets Equity strategy invests in a concentrated portfolio of companies from countries across the developing world. Many of these countries are undergoing positive economic and social change. They thus provide an advantageous base for dynamic enterprises that benefit from the attractive demographics, growing personal incomes, low manufacturing costs, rising middle classes and other characteristics of these markets.
We focus on the individual companies operating in emerging markets. We build our portfolio company by company while remaining vigilant in our monitoring of the investment conditions of these markets.
Within emerging markets countries, we seek to invest in companies that generate high free cash flow, have strong balance sheets and hold strong or improving market positions. Companies that fit our investment criteria for generating high free cash flow tend to outperform broad market measures over the long term. The equity in these companies tends to protect capital in down markets and share price volatility is often lower than the market averages. Additionally, these companies typically pay dividends and have capacity to maintain or even increase those dividend payments in poor economic environments.
We believe a concentrated portfolio of these types of companies, identified through financial statement analysis and thorough research will outperform the markets in the coming decades.