South Africa - Institutional
Global Emerging Markets Equity Strategy
INSTITUTIONAL
INVESTMENT OBJECTIVE:
The Coronation Global Emerging Markets Equity Strategy provides access to the best investment opportunities in Global Emerging Markets. It aims to deliver capital growth through a focused equity portfolio of securities of companies based in emerging markets or that derive a significant portion of their business from emerging economies. The objective is to outperform the MSCI Emerging Markets Index over 5 years and longer periods.
Coronation’s investment philosophy aims to produce outperformance by focusing exclusively on the long term. We conduct our own research to determine what a share is worth (its ‘fair value’), and only invest if the current price is sufficiently below this level, thereby offering some margin of safety. We focus on what a business will earn in a ‘normal’ environment over the long term (which is often many years from now) and what investors, in our view, should be willing to pay for such an earnings stream today. This allows us to ignore short term ‘noise’, which is a key competitive advantage since shares often trade on near-term earnings prospects instead of long term earnings power. Given the large investable universe, we have a preference for above-average businesses – those that exhibit a combination of key factors such as sustainable competitive advantage, pricing power, decent returns on capital and high cash generation abilities – but our decision to invest will always be based on whether there is sufficient margin of safety relative to the risks of each investment case. Our portfolios are fairly concentrated (50-60 stocks) and reflect our high-conviction ideas prominently. They are constructed without any reference to the benchmark, so short term portfolio returns will differ materially - whether positive or negative - from those of the benchmark. Over a more meaningful performance measurement period of at least five years, our focus on owning only undervalued shares should, in our view, deliver performance in excess of the benchmark. The primary method of risk control is only owning stocks that trade well below fair value to ensure there is no permanent loss of capital from owning overvalued shares. Additionally, our portfolios are constructed such that there is no excessive exposure to any one country, industry or other single identifiable factor that can have an unexpected and outsized impact on portfolio returns.
The value of investments may go down as well as up, and is therefore not guaranteed. Past performance is not necessarily an indication of future performance.
| STRATEGY RETURNS GROSS OF FEES | |||
|---|---|---|---|
| STRATEGY | BENCHMARK* | OUTPERFORMANCE | |
| Since Launch (unannualised) | 125.2% | 63.2% | 62.0% |
| Since Launch (annualised) | 5.1% | 3.0% | 2.1% |
| Latest 10 years (annualised) | 1.8% | 3.5% | (1.7)% |
| Latest 5 years (annualised) | 1.5% | 3.9% | (2.4)% |
| Latest 3 years (annualised) | (5.1)% | (1.4)% | (3.7)% |
| Latest 1 year | 28.6% | 25.3% | 3.3% |
| Year to date | 13.2% | 11.7% | 1.5% |
| Latest 6 months | 6.7% | 8.6% | (1.9)% |
| Latest 3 months | 8.2% | 3.6% | 4.6% |
| Month | (3.2)% | (4.4)% | 1.2% |
* MSCI Emerging Markets Total Return (net) Index (Bloomberg ticker: NDUEEGF)
The value of investments may go down as well as up, and is therefore not guaranteed. Past performance is not necessarily an indication of future performance.
All information and opinions provided are of a general nature and are not intended to address the circumstances of any particular individual or entity. As a result, there may be limitations as to the appropriateness of any information given. It is therefore recommended that the reader first obtain the appropriate legal, tax, investment or other professional advice and formulate an appropriate investment strategy that would suit the risk profile of the reader prior to acting upon such information and to consider whether any recommendation is appropriate considering the reader’s own objectives and particular needs. Neither Coronation Fund Managers Limited nor any subsidiary of Coronation Fund Managers Limited (collectively “Coronation”) is acting, purporting to act and nor is it authorised to act in any way as an adviser. Any opinions, statements or information contained herein may change and are expressed in good faith. Coronation does not undertake to advise any person if such opinions, statements or information should change or become inaccurate. This document is for information purposes only and does not constitute or form part of any offer to the public to issue or sell, or any solicitation of any offer to subscribe for or purchase an investment, nor shall it or the fact of its distribution form the basis of, or be relied upon in connection with any contract for investment. In the event that specific funds and/or strategies (collectively “funds”) and/or their performance is mentioned, please refer to the relevant fact sheet in order to obtain all the necessary information regarding that fund Investment Strategies. Fund investments should be considered a medium-to long-term investment. The value of investments may go down as well as up, and is therefore not guaranteed. Past performance is not necessarily an indication of future performance. Funds may be allowed to engage in scrip lending and borrowing. To the extent that any performance information is provided herein, please note that: Performance is calculated by Coronation for a lump sum investment with distributions, to the extent applicable, reinvested. Performance figures are quoted gross of management fees after the deduction of certain costs incurred within the particular fund. Fluctuations or movements in exchange rates may cause the value of any underlying international investment to go down or up. Coronation Fund Managers Limited is a full member of the Association for Savings and Investment SA (ASISA). Coronation Asset Management (Pty) Ltd (FSP 548), Coronation Investment Management International (Pty) Ltd (FSP 45646) and Coronation Alternative Investment Managers (Pty) Ltd (FSP 49893) are authorised financial services providers. Coronation Life Assurance Company Limited is a licenced insurer under the Insurance Act, No.18 of 2017.