3 February 2017, Bloomberg
If Donald Trump slapped China with punishing tariffs, the pain would also be felt by Japan, South Korea and Taiwan, vital cogs in a regional supply chain that allows China to build widgets and gadgets for the world.
December 2016, James Brown, Portfolio Manager
What is the purpose of share indices? Are they an investment target, an investment return benchmark, or are they simply an indication of the investment opportunity in any particular market? To appreciate their role, it’s important to understand how they’re compiled.
In most cases, equity indices are market capitalisation weighted, meaning the larger a company is, the larger weighting it has in the index. For example, at 30 September, the Commonwealth Bank made up 8.7 per cent of the ASX200 index with the big four banks comprising over 26 per cent.
August 2016, James Brown, Portfolio Manager
Already a force to reckon with, emerging markets are commanding more economic and political power as they grow and flourish thanks to rising trade and investment. Economist and financier Antoine van Agtmael, coined the term ‘emerging markets’ as a marketing catchphrase in the 1980s1 and while definitions vary today, broadly speaking, emerging markets are those nations with an economy progressing toward becoming more advanced, usually by means of rapid economic growth and industrialisation.
So what is the appeal? By 2025, annual consumption in emerging markets is expected reach $30 trillion2—something leading management consultancy McKinsey & Company say is “the biggest growth opportunity in the history of capitalism”3, and we believe one of the brightest of those markets is India.
June 2016, James Brown, Portfolio Manager
Between 1980 and 2010, over 600 million people moved out of poverty in China. As this massive group transitions into the middle class, they are bringing with them a greater disposable income thanks to better earning potential. These people might also be buying simple consumer staples such as toothpaste or packaged foods for the first time and therefore are predominantly driving sales and profits for consumer-facing companies. It is the speed of this change, especially for services and retail, that is important for investors to consider.
