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BNNBloomberg has a great story today about the #1 ’emerging markets’ fund manager, Lewis Kaufman.
He is the manager of the Artisan Developing World Fund and the secret to his success — it seems — is not investing in emerging markets.
As of the last public filing, more than 40% of the fund’s $3 billion was
invested in US-based companies. It’s not just tech stocks. It’s also
names like Coca-Cola and Visa and Estee Lauder. Throw in European stocks
and the percent of Kaufman’s portfolio invested in companies based in
developed nations comes to more than 50%. The median number for rival
emerging-market funds is 5%, according to Morningstar Direct.
A top holding is Snowflake, which gets almost 80% of its revenue from the US with a good chunk from Europe as well.
There has to be some kind of rule against that but I doubt his investors are complaining after him as he crushed the index, which has been flat for 17 years.
With that, I’m thinking of starting a forex-investing fund. The main holding will be shares of NVDA… after all, they do use currencies, right?
Jake @EconomPic highlights that his fund is only really ‘outperforming’ because it’s mis-classified. He’s badly underperformed both the Nasdaq and a 50/50 Nasdaq/EM index mix.
