FidelityConnects: Fidelity Emerging Markets Opportunities Fund: Looking for growth beyond the usual markets
Join Portfolio Manager John Dance for his FidelityConnects debut as he highlights the opportunity set in emerging markets.
Learn how the Fidelity Emerging Markets Opportunities Fund aims to deliver diversified global equity exposure through active management, and investing in companies driving innovation and growth across emerging economies. Discover how this strategy can help complement developed market allocations and enhance portfolio balance.
Transcript
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<b>Subtitles are AI Generated</b>
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Hello, and welcome to Fidelity Connects.
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I'm Pamela Ritchie. Emerging markets are home to the majority of the world's
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population but still a fraction of global market value.
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That gap is creating a deep and often overlooked opportunity set for investors
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seeking growth and diversification.
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Our next guest says that gives him far more ability to find disparate
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opportunities. Where are the most compelling investments across
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emerging markets today? How should investors be thinking about building
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exposure? Joining us now to make his Fidelity Connects debut is
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John Dance. He is portfolio manager of Fidelity Emerging Markets Opportunities
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Fund. Warm welcome to you, John. Hello.
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Thanks, Pamela, for having me on. I appreciate it.
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Delighted to have you join us here today.
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I'll just let you know that what we discuss today all has live French audio
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interpretation for those who want to join us in either official language here
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in Canada. Please do send in questions for John over the next
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30 minutes or so. John, let's begin with a little bit ...
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you've been with Fidelity truly around the globe
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for many years. Do you mind just bringing us up to date?
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You're in Boston now but how did you get to this stage?
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I began my career almost 20 years ago, August
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of this year will be 20 years at Fidelity.
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I started in Hong Kong as an analyst looking at shipping and airlines
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and transport stocks. In 2006 I ended up moving
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to the United Kingdom, I looked at consumer in 2008, and
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then went back in '13 to Hong Kong where I started running one
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of our diversified Asia products and then an emerging Asia product, taking
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over a global emerging market fund in '19.
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In 2020 January moved to Boston
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where I've been ever since.
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2020, so sort of in the midst of the pandemic there to an extent, wasn't it?
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It was all kind of unfolding just about.
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Correct. I thought I was going to be moving here to get down
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[audio cuts out] and I ended up being in my basement a little bit more than I
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would have liked. Had a good time exploring the surrounds anyway.
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Well, there you go. It's fascinating.
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The emerging markets have come into vogue, gone out of vogue.
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There's been a lot of moments where everyone thinks, oh, this is the moment,
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and sometimes it really is, and sometimes it's less so.
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A year and a half ago the whole world got involved, it seemed, of investments
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with the international trade.
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EM was a massive part of that. Obviously, it did very well alongside that.
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Is that about done?
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I don't think so. I think we're still in the early innings of what is a really
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long run opportunity.
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For me it just comes down to the raw demographics.
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When I look at the emerging markets it's 70, 80%
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of the global population.
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It's the [audio cuts out] adjusted GDP.
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It's around 20% of world's market [audio cuts out].
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As I see a rising middle class in a lot of these markets with billions
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of people, hopefully be moved out of poverty and moving into that rising middle
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class, they're creating lots of opportunities for themselves,
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self-innovation, new ideas for products and services which
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they can initially serve themselves and then expand globally.
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I think that's what the real opportunity is.
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It's a long one driven by the fact of where people are and what we're
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now empowering people to do with the advent of new technologies and skill sets
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and education.
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The fund itself, tell us a little bit about your style,
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what the fund sort of is meant to do in its key
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ways of organizing itself.
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How do you look at this fund? How would you describe that?
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Sometimes we like to do it in terms of style but not always.
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I think of what I'm trying to achieve is something I call [audio cuts out].
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The way I would think about that is superior business models married to
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improving customer [audio cuts out] propositions.
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What that really means is fantastic businesses
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as they are today.
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That would be wide moats in that sort of Buffett, Munger style of thinking
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about quality companies with fantastic management teams.
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I really want them focused on how to make the products or services that they
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have better. Improving the customer value proposition for
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me means the pricing can get better, you can make something the
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same price but superior in terms of what you're offering your
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customer, or a combination of both.
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There's lots of examples of that in my markets.
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I think of what Taiwan Semiconductor does, advancing
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the leading edge of logic chips as an example.
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At the same time I think of the service offering of a very
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deep discount supermarket in Mexico, making products that
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are as good and broadening their range but making it [audio cuts out] cheaper
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for their customers. Rolling that out to more places in Mexico
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is an opportunity [audio cuts out].
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How can you make what you've got already great better for your customers?
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One of the things, I mean, just by nature of the way you're investing you'll
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have to at least consider things like the global interest rate picture, how
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it's different in certain countries, where it's going directionally, and
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ultimately a currency discussion.
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If you've got a currency that is rocketing up or down
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that's something to take into consideration.
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Are you able in the fund to actually lean into some of the good pieces of
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that? This is sort of the macro lens, do you put that on?
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The first macro lens I put on is always the one [audio
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cuts out] for the countries which I want to avoid.
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The reason is is that emerging markets has a history of having
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significant drawdowns in the foreign exchange as a consequence of
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mismanagement at a government level, the examples such as
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Turkey or Argentina over the last 15, 20 years, maybe not today
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but back then are strong examples of that.
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We're seeing similar things in places like Indonesia today with
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an increasing worry about mismanagement at that sort of level.
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The drawdown is the thing I'm trying to avoid.
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That's not to say that we aren't seeing pockets and areas of strength in
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emerging market economies. The examples I always give at the moment, Greece is
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probably one of the better economies in the EU.
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It is part of emerging markets because of what happened in the European crisis
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over a decade ago but now is going from strength to strength.
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Poland is going to achieve, it looks like, PPP adjusted GDP
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per capita better than the United Kingdom by the end of the decade.
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I look at what's going on in the Southern Cone, places like Chile is another
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example. The UAE up until
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the beginning of the Iran conflict, really, really strong in
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terms of demographics as well as the opportunities set from a macro
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perspective. The broad ranging emerging markets,
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we have everything from hyperinflation in [audio cuts out], like I mentioned
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earlier, to deflation in places like China and everything in between.
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What I'm really trying to do from a first principles basis top down is avoid
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the areas of critical loss and lean in more heavily to the areas where there is
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a sort of assistance or structural growth from first principles that the
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government is assisting.
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That was a wonderful sort of tour around and a reminder that some
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quite well-known and more highly thought of countries
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around the world are still within emerging markets.
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I might just ask, even China's been in the emerging markets, I
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don't want to call it a bucket, it's massive, it's like a sea but for a long
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time ... how do these things change?
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I know there's a financial maturity within the country
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itself that has to take place but it does seem like some very well established
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countries are still EM. Maybe just talk a little bit about that
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when that shifts, if it does.
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This is a definition according to MSCI.
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I look at places like Korea and Taiwan and Greece as
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pretty developed in terms of GDP per capita, in terms of
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education levels. Literacy in China is 97%.
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It has a GDP per capita much lower than those two countries but PPP adjusted
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is continuing to improve. The definition
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of MSCI is what I lean into as my lodestar but in reality
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what I'm really trying to do is capture
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those different areas of development, the best opportunities.
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Sometimes the macro matters and sometimes it doesn't.
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I have [audio cuts out] with very high levels of interest rates, I still can
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find fantastic businesses which I won't be able to find anywhere else so as
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a result I'm more than happy to look past
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those macro risks for the long run opportunity that the businesses present
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themselves.
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If we look at Canadian investors making Canadian bucks and thinking to
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diversify around the world and have different exposures,
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it's not so long ago that Canada was a little bit written off as
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a petro state. It's not entirely wrong when you look at what's
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doing well in terms of sort of materials and energy, certainly in this country.
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I mean, there's some grounding for pieces of that theory.
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How much extra exposure to other things would a Canadian investor get taking a
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look at something like an EM fund that you're running?
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I think I have a natural ability to think in a similar way
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to the Canadian investor in that regard.
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You might not be able to tell from my accent but I'm from Australia.
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We have a very similar setup just
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from first principles. We have a large materials industry, we have a
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large energy industry, we export more gas than Qatar, and
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we have some banks. I am always also
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thinking about what should I be in outside of those things.
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That's what I grew up in, the environment.
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For me, the thing about emerging markets which is so fantastic is
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the breadth. We have 11,000 stocks in my
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investable universe, more if I include the Chinese
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A shares which aren't in the benchmark as well which I think are fair game for
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me to look at. It's all four points of the compass.
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What I'm really trying to do is turn over as many rocks as I can
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and find those gems across all those markets.
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It can be supermarkets in Poland, companies
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doing backend business systems similar
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to SAP but in an indigenous Brazilian context.
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It's Kazakhstan [audio cuts out] tech companies, it's Chinese
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[audio cuts out] equipment businesses, it's the tech space here, Taiwan, it's
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skin care products in places like Korea.
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It runs a very, very wide gamut.
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What I would say is that that's why I find emerging markets most interesting.
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There is a supplemental number of fantastic businesses which can
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only really be found in those environments.
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That's the sort of stocks I'm trying to own in a well constructed portfolio.
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I think that's what I bring to Australian investors and Canadian investors
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alike, the opportunity to diversify away from the
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four or five key banks, the
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domestic energy exposure into some of these more disparate and
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very esoteric opportunities.
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It is fascinating when you watch some of the trade alliances.
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I don't know if they're shifting immediately but there's certainly a lot of
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discussion around increasing certain alliances as other alliances fracture
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a little bit. There's change there.
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How close of a pulse do you keep on that?
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Is that something that you watch very closely or are a lot of the businesses
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quite domestically focused and don't have to worry about whether they will be
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exporting with or without tariffs.
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It's of critical importance.
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I've been thinking about it a very long time.
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The China trade war began in the first Trump administration
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so it's been food for thought ever since.
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What I would say is the unintended consequences of the
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trade war are actually really important to consider.
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We now see China as the largest manufacturer on
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the planet. They've continued to grow even with the tariffs that have been
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increased over the last 12 to 18 months.
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The reason for that is that there has also been, because of large CapEx
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investments and demand for non-Chinese products by the
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US, there's been large demand rest of world for Chinese products, as an
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example. I'm just using China as an example here in
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the general but they've continued to grow in exports
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and in industrial production in spite of the tariff environment.
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What I would say is the uncertainty that tariffs are bringing global
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is, I think, of importance.
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It sort of hits back to me on one of the key components of my investment
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philosophy which is it's much better to be in a business that
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people want regardless of the tariffs being put on
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because your product is so fantastic or your service is so wonderful, and
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you're improving those products and services.
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The tariff hits everybody but the uniqueness of what you're
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offering transcends, hopefully, some of those
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tariffs. There are businesses which have increased sales
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in the United States in spite of tariffs [audio cuts out] what they're offering
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to their customers.
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That's fascinating. Can you just give us sort of an industry example?
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Maybe not the name but what's an example of that?
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Healthcare is a really clear example. China has
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become really, really important in the
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world of what I call molecules. I think of what China offers is the world of
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atoms, the world of molecules and the world of electrons, and in the world of
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atoms they're going from strength to strength.
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One of the reasons is they have a very large population so clinical
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trials have become extremely important there because we're all very genetically
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similar regardless of where we live.
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The opportunity to develop drugs in China is increasing, the cost base
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of doing so is lower, and they've cut 1,300, 1,400 days
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of red tape out of that process in China over the last three to five
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years. There's a really great article in [audio cuts out] about that.
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They're playing an increasing role in the global healthcare space,
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including in the United States, because the cost of the drugs that they can
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offer is going down, the number of drugs they're developing is going up.
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That's fascinating. We've been hearing about the commoditization of the drug
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industry to an extent, a lot of that being actually manufactured and then
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exported from China.
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There's more to do there. Can you give us a sense of regionally ...
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maybe you don't like to carve it up this way but I think people are always
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interested ... regionally, the allocations and how that works.
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It's a question coming in just now for you on that.
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Let me just describe how I cover that regionally first and foremost.
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I think of Latin and South America as a single region.
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I think of the Middle East as a singular region.
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I think of Eastern Europe and then into what
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would be called Eurasia as a region.
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Then I think India and I think Southeast Asia.
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I think of China and I think of Korea and Taiwan.
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They would be the regions [audio cuts out].
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At present I'm overweight China.
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I'm slightly underweight India.
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I'm underweight parts
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of Latin America but overweight others so it's sort of neutral.
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Then overweight Eastern Europe and then slightly neutral to
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underweight other regions, and underweight
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Southeast Asia. That would be one of the largest underweights.
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At the moment my positioning ... the most obvious
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and important regional positioning is the overweight position in China.
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Okay, fascinating. That's the biggest.
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There are conflicts going on around the world.
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I don't want to get into those but sometimes there are second order discussions
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of because this has happened a new company or industry
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has had to make do and actually succeeded because something else was scarce.
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There are sort of the second order pieces that become opportunities that
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might not have been before. Are there some that you can point to?
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Rebuilding certain areas and then cement companies do very well in certain
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areas, are there other types of examples like that that have been of use that
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might be surprising, actually, to people watching here today.
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The [audio cuts out] one has been global defence, I think that goes without
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saying. Just to highlight, the fact that most of the conflicts that are
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happening in the world today are happening in or around emerging markets.
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It's no surprise that the UAE and
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Saudi Arabia have been impacted by the Iranian conflict, the conflict in
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Ukraine, obviously.
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One of the beneficiaries there has been Turkey.
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It's at the centre of all of this but has been sort of uninvolved with most
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of these conflicts, maybe at the margin in Syria.
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The Turkish defence companies [audio cuts
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out]. The example I really wanted to talk about is
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what we've really seen with the closing of Hormuz.
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[audio cuts out] going up, concerns about
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supply chains in things like energy as well as other areas
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[audio cuts out] helium, for example. As those supply
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chains expand and increase it does benefit the shipping companies.
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I own a company that's actually based in France
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but 100% of their sales are the industrial gas [audio
18:11.924 --> 18:15.494
cuts out] that they sell into the LNG carrier companies which are made in China
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and Korea. These guys benefit because what we're
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seeing is longer ton-mile means more ships are needed.
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If we're shipping energy and gas from the United States to Europe, that's the
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longer destination. If it's going to Asia, it's longer still.
18:31.410 --> 18:31.710
Their benefit...
18:31.710 --> 18:36.949
What's it made of? What's so special about it?
18:36.949 --> 18:39.785
The way that an LNG carrier works is really interesting.
18:39.785 --> 18:44.356
I used to think it was like your lungs as in you could replace them
18:44.356 --> 18:48.494
with lung transplant, it used to sit on top of the carrier, now it
18:48.494 --> 18:53.065
sits through the entire carrier so I think of it as the lymph system.
18:53.065 --> 18:58.604
It's a real proprietary metal, ceramic film,
18:58.604 --> 19:02.975
the secret sauce. They're the only ones that do it but you
19:02.975 --> 19:06.245
can't take it later.
19:06.245 --> 19:10.315
The LNG carriers in the hundreds of millions of dollars getting these
19:10.315 --> 19:14.353
as films in the tens of millions of dollars but you require
19:14.386 --> 19:18.657
it because you're also using the gas in your LNG carrier to ship
19:18.657 --> 19:22.294
everything from A to B so you want to have as much at B when you get there.
19:22.294 --> 19:26.598
It's your fuel as well as what
19:26.598 --> 19:29.434
you're selling so it needs to be as efficient as possible.
19:29.434 --> 19:33.405
To minimize the boil-off is a really important matter
19:33.405 --> 19:37.843
for the LNG carriers and for the gas companies on either end.
19:37.843 --> 19:39.511
This is the best place to do it.
19:39.511 --> 19:42.381
To do it, that's fascinating. So it's actually a French company but, as you
19:42.381 --> 19:46.518
say, the production and everything to do with the economics happens in Korea.
19:46.518 --> 19:50.789
Correct. The way I think about my opportunity set is
19:50.789 --> 19:55.460
the economic interests has to be in emerging markets
19:55.460 --> 19:57.763
or moving in that direction.
19:57.763 --> 20:01.900
If you're an Australian owned mine but
20:01.900 --> 20:06.205
your mine is based in Brazil or in Guyana or in
20:06.205 --> 20:10.042
Africa then I'm more than happy [audio cuts out] opportunity set.
20:10.042 --> 20:12.477
That's really interesting.
20:12.477 --> 20:16.448
There are those that will say there's spheres of influence, you don't have to
20:16.448 --> 20:20.118
buy into any of these these big discussions about how the world will align
20:20.118 --> 20:23.989
because nobody really knows, have there been more opportunities, for instance,
20:23.989 --> 20:30.796
of late in Latin America and South America, any that you might point to?
20:30.796 --> 20:34.733
I think Latin America, South America looks really well placed
20:34.766 --> 20:37.703
at the moment for a whole host of reasons.
20:37.703 --> 20:41.740
The first one is, obviously, they're far away from the
20:41.740 --> 20:47.779
global conflicts outside of, I guess, what happened in Venezuela.
20:47.779 --> 20:50.849
That's a positive. Their trade routes are secure.
20:50.849 --> 20:54.286
They're very self-sufficient as economies and as a collective.
20:54.286 --> 20:58.924
Brazil is the third most singular economy in terms of its
20:58.924 --> 21:02.794
GDP. In terms of net exports is the third lowest than the other two countries
21:02.794 --> 21:05.364
in Central Africa.
21:05.364 --> 21:09.334
I believe it's Nigeria and I think
21:09.334 --> 21:13.305
the other one Chad, but it's
21:13.305 --> 21:14.806
not within my investable universe.
21:14.806 --> 21:17.676
Are those frontier nations, for instance?
21:17.676 --> 21:21.780
They would both be considered frontier but also just investable universe
21:21.780 --> 21:24.449
there is quite small. Brazil, it's not.
21:24.449 --> 21:27.419
The other thing we've seen, and maybe the exception is Brazil, we will see this
21:27.419 --> 21:31.723
year later, is that South America has moved largely to the right over
21:31.723 --> 21:37.562
the last couple of years, first Argentina but now Chile, Peru.
21:37.562 --> 21:42.000
What that does, it has meant better business practice, less
21:42.000 --> 21:45.937
risk of government intervention in market
21:45.937 --> 21:46.938
economies.
21:47.806 --> 21:52.077
Not only are we having strong tailwinds from the geopolitical environment
21:52.077 --> 21:55.814
but the political environment itself is meaning that they're benefiting.
21:55.814 --> 22:00.652
The third thing being strong levels of rule of law, improving institutions,
22:00.652 --> 22:05.023
and then just great businesses with strong management teams, if
22:05.023 --> 22:06.892
you work hard enough to find them.
22:06.892 --> 22:09.261
That's pretty fascinating.
22:09.261 --> 22:14.066
With the export discussion, just to kind of come back to that for a second,
22:14.066 --> 22:17.703
is there anything directionally that you see that might be useful just to share
22:17.703 --> 22:21.673
with investors? This does go down sort of the discussion
22:21.673 --> 22:25.844
of new alliances, new exporting places for various
22:25.844 --> 22:29.948
countries, new neighbours, maybe, and those across.
22:29.948 --> 22:32.984
Are there directionally some interesting areas that you would look to maybe
22:32.984 --> 22:36.655
even just to sort of the future?
22:36.655 --> 22:40.726
The most important thing to think about is the fact that within the
22:40.726 --> 22:44.796
emerging markets over 50% of trade is now happening
22:44.796 --> 22:48.834
within themselves. This points to what I was sort of talking about
22:48.834 --> 22:52.771
earlier, if you're a
22:52.771 --> 22:56.041
Vietnamese guy and you start a great startup maybe that trickles down into
22:56.041 --> 22:59.311
Indonesia and then to Thailand and then to China.
22:59.311 --> 23:03.515
The tech stack that China [audio
23:03.515 --> 23:07.886
cuts out] in everything from EVs to renewable energy to power equipment is
23:07.886 --> 23:11.490
making its way into all these other markets.
23:11.490 --> 23:15.494
One, [audio cuts out] costs. Second reason is just the quality of product and
23:15.494 --> 23:19.564
services being founded by people is getting better and better.
23:19.564 --> 23:23.735
There's a Kazakhstani company I own which owns the tech
23:23.735 --> 23:27.839
stack in terms of how you interact with first e-com and second
23:27.839 --> 23:30.175
consumer finance.
23:30.175 --> 23:33.712
They're so penetrated in Kazakhstan, you get your driver's licence for this
23:33.712 --> 23:35.947
app, you can get married on the app.
23:35.947 --> 23:39.885
When you leave Kazakhstan to go to another country on a holiday
23:39.885 --> 23:43.755
you have to go the ATM to get out a card because everything's done so digitally
23:43.755 --> 23:46.591
through that app in Kazakhstan.
23:46.591 --> 23:51.630
People want that tech stack. It's moving into other places like Turkey.
23:51.630 --> 23:55.834
We're seeing the permeation of innovation and ideas
23:55.834 --> 23:59.805
and therefore export both in products and services happening
23:59.805 --> 24:02.040
within the market, so watch that space.
24:02.040 --> 24:05.710
The other thing I'd say is just to continue as in India.
24:05.710 --> 24:10.081
India 30 years ago
24:10.081 --> 24:14.386
was sort of GDP per capita as China and it's fallen by the wayside given the
24:14.386 --> 24:18.323
economic miracle that is China. They are now trying to develop their
24:18.323 --> 24:20.525
export economies in a similar fashion.
24:20.525 --> 24:23.495
That's in very early innings but there's still lots of incremental
24:23.495 --> 24:25.230
opportunities where that's happening.
24:25.230 --> 24:30.001
I see that as another exciting space to watch going forward.
24:30.001 --> 24:34.272
Tell us about your research team which must be literally in the four corners
24:34.272 --> 24:35.307
of the globe.
24:36.374 --> 24:39.845
Yeah, they are. The good thing is that, you know, I have two young kids so I'm
24:39.845 --> 24:42.013
up early.
24:42.013 --> 24:46.051
I spend a lot of my time in the morning talking to Asia and a little
24:46.051 --> 24:50.555
bit to our team in the UK.
24:50.555 --> 24:53.425
We have a bunch of analysts, 18, 19.
24:53.425 --> 24:55.961
I think we have a couple of interns there at the moment as well so I might have
24:55.961 --> 25:00.499
to bump the numbers up a little. In Hong Kong, we have people
25:00.499 --> 25:05.036
looking at emerging market stocks in the UK and London.
25:05.036 --> 25:10.709
We have a team here as well looking at the rest of the markets,
25:10.709 --> 25:14.112
EMEA, LatAm.
25:14.112 --> 25:17.048
I have a lot of time bookmarked at the end of the day and at the beginning of
25:17.048 --> 25:19.618
the day talking to them. I have the good fortune of knowing a lot of them
25:19.618 --> 25:22.153
personally having lived in both places.
25:22.153 --> 25:26.091
I've spent a lot of time ... not just on the Zoom calls but
25:26.091 --> 25:28.093
in situ with everybody.
25:28.093 --> 25:31.997
I know them really well so it's always great to catch up.
25:31.997 --> 25:36.835
Part of my personal philosophy is I'm a connection maximalist.
25:36.835 --> 25:40.839
I spend as much time as I can talking to our own
25:40.839 --> 25:44.809
teams, talking externally, trying to connect the dots because I think most
25:44.809 --> 25:48.947
of the alpha happens at those edge cases where I
25:48.947 --> 25:53.051
can get people talking to each other, connect the
25:53.051 --> 25:57.489
dots myself on the mosaics which may come about and generate ideas.
25:57.489 --> 26:01.693
That's where I find the deepest, most exciting long term sources
26:01.693 --> 26:05.697
of alpha. I usually connect those dots earlier than others, get in a little
26:05.697 --> 26:09.901
bit earlier and then be there on their five-year view
26:09.901 --> 26:13.405
as opposed to trying to chase trends.
26:13.405 --> 26:17.142
I spend a lot of time doing that.
26:17.142 --> 26:21.613
2:00 to 4:00 in the afternoon is my time where I get a little bit of
26:21.613 --> 26:26.117
downtime because markets are closed, things have settled in here in the
26:26.117 --> 26:29.621
US. Then usually go home, have dinner, and then I'm back at it in the evenings,
26:29.621 --> 26:33.158
either for calls with management teams or with the analysts again.
26:33.158 --> 26:37.996
Rust never sleeps, as that great Canadian musician once said,
26:37.996 --> 26:41.633
so I'm working pretty hard around the clock.
26:41.633 --> 26:45.804
I bet you are. That sounds like a fascinating career and job, and
26:45.804 --> 26:48.406
your team, that sounds just incredible.
26:48.406 --> 26:51.009
I wanted to just go quickly back to a point that you made there.
26:51.009 --> 26:54.446
I think you were talking about a Kazakhstan company but just that idea of
26:54.446 --> 26:58.350
leapfrogging if they've done such a good job of sort of having this tech stack
26:58.350 --> 27:01.386
with everything to do with ... it sounds like government administration can all
27:01.386 --> 27:03.054
be done on it as well.
27:03.054 --> 27:06.224
Everything.
Do you see that ...
27:06.224 --> 27:10.228
all governments are trying to retool how
27:10.228 --> 27:14.332
they conduct themselves with better technology, do you see emerging
27:14.332 --> 27:18.236
markets a better place to do that, do exactly that?
27:18.236 --> 27:23.108
In some cases it is because they've never had anything.
27:23.108 --> 27:25.010
India's a great example, Brazil's a good example.
27:25.010 --> 27:29.147
They went straight to a tech stack which is
27:29.147 --> 27:31.583
digitally native, it's biometrically authenticated.
27:31.583 --> 27:36.788
They went from having 300 million people
27:36.788 --> 27:40.825
.... 500 million people under-banked or unbanked to having them all on this
27:40.825 --> 27:42.727
tech stack within three years in India.
27:42.727 --> 27:46.965
Brazil has one of the best global digital native
27:46.965 --> 27:52.103
banks with over 100 million customers in Brazil because again,
27:52.103 --> 27:56.307
they were able to go from having nothing to a
27:56.307 --> 28:00.278
banking and payment system that was developed by the government
28:00.278 --> 28:03.748
which facilitated this huge rise in digital banking services.
28:03.748 --> 28:08.853
I think we'll see more of this in my markets as we go forward.
28:08.853 --> 28:11.990
China was another example with digital payments being very early.
28:11.990 --> 28:15.960
Kenya as well. I think that they will continue to lead because of
28:15.960 --> 28:20.031
necessity. Being so low on the cost curve to do so
28:20.031 --> 28:21.499
means that you may as well do it.
28:21.499 --> 28:24.436
Fantastic. What an exciting area and moment.
28:24.436 --> 28:28.540
What, as a final sort of word to investors, might you like to leave
28:28.540 --> 28:32.944
with everyone considering, again, their exposure with
28:32.944 --> 28:35.914
their investments?
28:35.914 --> 28:39.851
I think that there's been a historical want to be underweight
28:39.851 --> 28:43.888
even when I guess global allocation would suggest emerging markets you would
28:43.888 --> 28:48.293
want to be. I would suggest that we are in a period of time now
28:48.293 --> 28:52.597
where the digital innovation is coming at such a pace and people
28:52.597 --> 28:56.634
are able to innovate, self-innovate or innovate in and
28:56.634 --> 29:00.305
amongst themselves that the emerging markets is offering more shots on goal for
29:00.305 --> 29:03.341
that. It's a really exciting time there.
29:03.341 --> 29:07.312
I've never been more excited about
29:07.312 --> 29:09.481
[audio cuts out].
29:09.481 --> 29:13.084
[audio cuts out] today I'd suggest to continue to watch this space because the
29:13.084 --> 29:16.454
next couple of years are going to provide a real opportunity to find fantastic
29:16.454 --> 29:17.655
businesses here.
29:17.655 --> 29:19.390
Oh, you brought in ...
29:19.390 --> 29:21.526
you spoke to Canadians hearts there with the shots on goal.
29:21.526 --> 29:23.628
Well done.
29:23.628 --> 29:27.332
Super to speak with you, John, and have you introduced to this audience.
29:27.332 --> 29:29.134
Thank you very much for your time today.
29:29.134 --> 29:31.770
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