Facilitator: Don Wild. Experts: Vera German and Juan Torres
- Investors and Fund Managers all have innate biases, influenced by their own life experiences but also the popular trends of the day
- Understanding ‘risk’ is also subject to ‘interpretation’ - an example being where people have grown up in a developed or developing country
- Experiencing risk in everyday life brings a fresher perspective when looking at developing markets
Value Strategy for Investing originated in the 1930’s , when there was;
- Less competition
- Limited information
- Challenged Currencies
- Non Value orientated share holdings
These conditions are now prevalent in the emerging markets of today . Thereby presenting an opportunity
Alibaba was used as an exemplar of how sentiment and ‘media’ platforms can affect the market.
However, often times making the wrong call. The fundamentals of the company are under appreciated, and an opportunity arises , from focussing on the core value.
Understanding the ‘risk’ intrinsic to the market can be a real differentiator. Risk it self can be relatively subjective. A person brought up in a developing country could have a different appreciation of risk than a person in a developed country. Local/regional knowledge , can add a real difference.
Appreciation of the influence of sentiment and how people see ‘risk’ are key ingredients to a a robust ‘team’ model to investing and importantly when withdrawing. The example given of Russia, where the team approach, assisted an orderly staged withdrawal, prior to the recent conflict.
- Emerging Markets present a good opportunity, as part of an overall portfolio
- Local knowledge, alongside investment expertise, framed within a robust ‘team approach’ are enabling value investors to gain from Emerging Markets