Insights

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Portfolio Manager Alice Popescu shares her perspectives on emerging markets, focusing on five key themes (pertaining to de-coupling, China, India, capital returns, and frontier markets) and associated risks.

10 min read | After a strong 2022, we expected that emerging and frontier markets would avoid an economic hangover, and this proved to be true. Both EM and frontier countries demonstrated stronger absolute and relative economic performance, paired with moderating inflation, active and early central bank policymaking, and relatively stable currencies. China was the primary disappointment, as its post-pandemic re-opening led to flatter-than-expected domestic activity and failed to reverberate through many countries in Southeast Asia. Meanwhile, internal consumption across EM was broadly resilient, and the trend of emerging markets de-coupling from developed markets continued.

8 min read | International Equity markets delivered strong gains in 2023, climbing 18.2% for the year and 10.4% in the fourth quarter, as measured in US dollars. These gains marked a reversal of 2022's dismal market performance (-14.5%), as animal spirits returned with vigor. 2023 concluded with the VIX near multi-decade lows, bitcoin up over 150%, global high-yield bond spreads near 15-year lows, and equity investor bullishness near all-time highs.

Quarterly Letter

8 min read | Global Equity markets delivered strong gains in 2023, climbing 23.8% for the year and 11.4% in the fourth quarter, as measured in US dollars. These gains marked a reversal of 2022's dismal market performance (-18.1%), as animal spirits returned with vigor. 2023 concluded with the VIX near multi-decade lows, bitcoin up over 150%, global high-yield bond spreads near 15-year lows, and equity investor bullishness near all-time highs.

6 min read | by Rich McCormick | I recently spent two weeks traveling in Japan, meeting with leaders across a range of industries, from banking to real estate to industrials to technology. Over the past several decades, our team has visited the country consistently, helping us find many “diamonds in the rough.” We have noted positive – albeit slow – developments across the corporate landscape, particularly over the past several years. Increasingly, I have heard investors speaking of enormous change underway in Japan, but my trip revealed a more nuanced story of continued incremental progress rather than radical change.

Portfolio Manager Alice Popescu provides a two-minute summary of her Q3 2023 emerging markets investment commentary, including her contrarian perspectives on China.

7 min read | The Altrinsic Emerging Markets Opportunities portfolio declined 2.4% (-2.6% net) compared to the 2.9% decline of the MSCI Emerging Markets Index, as measured in US dollars. Performance throughout the period varied markedly within emerging market, with a stark divergence between EMEA and Latin America. Performance across the market capitalization spectrum also varied, with small and mid-cap EM stocks substantially outperforming the broad EM index. Overall, EM equities outperformed developed markets in the third quarter.

9 min read | The Altrinsic International Equity portfolio declined 2.1% (-2.4% net) during the third quarter, as measured in US dollars, compared with declines of 4.1% and 3.8% for the MSCI EAFE and MSCI All Country World ex-US indices, respectively. Outperformance came amid volatility in stock, bond, currency, and commodity markets, as markets and economies are grappling with an environment transitioning from one flooded with free money to one of rising nominal and real interest rates. This transition, coupled with significant uncertainty around growth, inflation, regulation, technology competition, and government policy, contributes to elevated risk in markets. We believe these factors should support a broadening out in markets with greater attention paid to quality, valuation, and risk.

Quarterly Letter

9 min read | The Altrinsic Global Equity portfolio declined 1.6% (-1.8% net) during the third quarter, as measured in US dollars, compared with declines of 3.5% and 3.4% for the MSCI World and MSCI All Country World indices, respectively. Outperformance came amid volatility in stock, bond, currency, and commodity markets, as markets and economies are grappling with an environment transitioning from one flooded with free money to one of rising nominal and real interest rates. This transition, coupled with significant uncertainty around growth, inflation, regulation, technology competition, and government policy, contributes to elevated risk in markets. We believe these factors should support a broadening out in markets with greater attention paid to quality, valuation, and risk.

5 min read | The valuation case for international equities is among the most compelling we have seen in years, but this is only part of the story. The conventional wisdom is that non-US equities are cheap for good reason and that international stocks are either low-growth or high-risk, but fundamentals are stronger than many investors perceive. In this paper, we discuss the underappreciated case for investing in international markets, built upon several timely and compelling themes.

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