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COVID-19 UPDATE

As the COVID-19 outbreak intensifies and market volatility increases, get our latest insights.

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Featured White Papers

Our Journey to a Sustainable Future

As investors and advisors who focus on our clients' long-term success, sustainability is central to how we assess the risks and opportunities facing our clients. Read More (PDF)

EditGenetics—3 Ways of Improving Lives

Thomas A. Sternberg, CFA, Partner

Harnessing technology to solve known problems in healthcare and food is something we’ve been exploring in depth. In the first installment of our Convergence series, which examines five growth themes that are shaping the future of investing, Hugo Scott-Gall spoke with Global Research Analysts Tommy Sternberg, CFA, and Ben Loss, CFA, to discuss aspects of […]

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5 Differentiators in Emerging Markets Debt

Marcelo Assalin, CFA
Marco Ruijer, CFA

While we believe overall market conditions should remain favorable for emerging markets (EM) debt, the pandemic created idiosyncratic risks and diverging prospects across EMs. This makes it critical to have a clear understanding of the opportunities and risks these markets represent—and our hard currency strategy’s combination of top-down macro views with rigorous bottom-up credit analysis […]

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Technological Transformation

Jayesh Kannan, CFA

Strong demand for technology-led innovation can help more businesses digitalize their operations in order to make their products and services better, faster, cheaper, and more convenient. Watch the video or read the recap below. Over the past year, we have seen structural changes in the business models of companies operating across various sectors of the […]

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Healthcare Transformation

Camilla Oxhamre Cruse, Ph.D.

2020 was a year that had a profound effect on how we think about healthcare. COVID-19 revealed how vulnerable our healthcare system is, but it is also proving to be the tipping point for sweeping changes. And as the healthcare market evolves, investors will look for opportunities. Watch the video or read the recap below. […]

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Chip Shortages: Driving Forces, Long-Term Implications

Greg Scolaro, CFA

New and used cars are getting more expensive because of a global semiconductor (chip) shortage, but there’s much more to the story. While automotive shortages are certainly front center and right now, they didn’t occur in a vacuum, and understanding why they are happening can shed light on our long-term investment expectations for semiconductors and […]

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A Clearer Path for Fundamental Navigation

Thomas Clarke, Partner

Entering 2021, our equity exposure was the highest it had been for several years and we had increased risk in our currency strategy to reflect less caution—both of these reflecting our view that the gravitation of prices toward fundamental value had a somewhat clearer path ahead. As fundamental investors, we believe this is an attractive […]

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Disruptive Business Models Drive Growth Abroad

Alaina Anderson, CFA, Partner

The regulatory environment outside the United States is more conducive to the proliferation of disruptive business models, and, we believe, is one reason investors should consider international equities. Financial technology (fintech) is driving long-term shifts, such as the move toward card and even person-to-person payment—and these trends are likely to underpin above-average industry growth. Indeed, […]

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Finding Finance

The Active Share
The Active Share Podcast

Diversity in the financial services industry is an ongoing challenge, but it’s not due to a lack of talent; it’s due to a lack of exposure, education, and opportunity. But two nonprofits are hoping to change that. Join William Blair’s Hugo Scott-Gall for a conversation with Bevon Joseph, co-founder of the Greenwood Project, and Katherine […]

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ESG Integration Across the Cap Spectrum

Tara Patock, CFA

As an investment team managing U.S. equity portfolios across the capitalization spectrum, we experience firsthand the variability among environmental, social, and governance (ESG) data and third-party ratings. These differences largely emanate from the absence of a common reporting framework and the fact that companies are in different stages of ESG adoption within their businesses. We […]

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Incubating Technology

Kristina Blaschek

We live in a world of rapid technological change. It’s an intensely competitive landscape that requires constant innovation. This environment requires us to evaluate our technology stack in a quest to determine where we should buy, where we should build, and where we should partner. And that process brought us to incubators and accelerators. Global […]

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Demystifying Emerging Markets Debt

Marcelo Assalin, CFA

Emerging markets (EM) debt is a widely misunderstood asset class; as a result, we believe it is both under-researched and under-owned, and therefore may be under-valued. Yet the asset class offers diversification potential, strong historical performance, understandable risks, and a promising outlook—and when broken down to these basics, it’s not much of a mystery at […]

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Accelerating Changes in the Media Landscape

Jim Golan, CFA, Partner

Amidst the COVID-19 pandemic, changes in the media landscape have accelerated at an even faster rate than we envisioned a couple of years ago. The rise of subscription video-on-demand (SVOD), advertising video-on-demand (AVOD), and pay video-on-demand (PVOD) services, along with continued linear television cord-cutting and extended movie theater shutdowns, have forced Hollywood to reevaluate its […]

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Navigating Seismic Shifts

Thomas Clarke, Partner

The COVID-19 pandemic accelerated changes that were already taking place in capital markets. We are seeing huge swings away from long-term fundamental value, and as macro investors we seek to take advantage of these seismic shifts for the benefit of our clients. Watch the video or read the recap below. It’s been a recurring observation […]

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Opportunities in Middle Eastern Debt

Daniel Wood

When assessing opportunities in emerging markets (EM) debt, we consider both top-down and bottom-up perspectives—and recently, this led us to view two high-yielding Gulf Cooperation Council (GCC) countries as potentially interesting opportunities. Top-down global macro conditions appear positive for risk assets, fundamental and sustainability drivers have been improving markedly, and technical conditions remain supportive at […]

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Shades of Green

The Active Share
The Active Share Podcast

Green can be a moral color, a political color, or an economic color. Join William Blair’s Hugo Scott-Gall for a conversation with Adam Tooze, history professor at Columbia University and author of “Crashed: How a Decade of Financial Crises Changed the World,” for a multidisciplinary discussion of how the decade is shaping up from an […]

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A Recovery in Five Acts

Olga Bitel, Partner

We are in what we like to call the Mother of All Recoveries (MOFAR), but we don’t think it will expire in months or quarters: We believe it is a multiyear phenomenon that has the potential to slowly morph into something more sustainable (and it is not fully priced into assets). In some ways, this […]

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Pricing Flexibility in an Inflationary Environment

Robert Lanphier, Partner

Inflationary pressures are rising, driving up input costs in the form of materials, components, and labor. With U.S. equities at high absolute valuations, there is little room for companies reporting “in-line” quarters, let alone earnings disappointments. Higher input costs become a key risk to stock performance for the average company that is unable to react in a timely manner. […]

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3 Growth Areas in Healthcare

Thomas A. Sternberg, CFA, Partner

While a few key growth areas dominate our thinking about the healthcare opportunity, there are several other areas of growth that span these themes: contract research organizations (CROs) and contract development and manufacturing organizations (CDMOs), animal health, and dental care. CROs/CDMOs Pharmaceutical innovation is one of the most important stories in the healthcare industry, and […]

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2021: Rising Yields, Solid Earnings

Olga Bitel, Partner

Economic growth this year is likely to be strongest in decades, but the implications of this growth are hotly debated. In the fixed-income markets, we see nominal yields rising even if inflation does not accelerate beyond the 2% to 3% range. And in the equity markets, we expect 2021 to be all about earnings growth […]

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The Mother of All Recoveries

Ken McAtamney, Partner

The economy and stock market are behaving as we expected thus far in 2021. We’ve been referring to the post-pandemic economy as the “Mother of All Recoveries,” with yearly growth at a level not seen in decades. And we expect this recovery/expansion cycle to ultimately be measured in years, not months or quarters. Unlike the […]

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Stabilizing U.S. Treasury Yields Help EMD Returns

Marcelo Assalin, CFA
Marco Ruijer, CFA

Emerging markets debt (EMD) performance was significantly impacted by the sharp increase in U.S. Treasury yields during the first quarter of the year. Looking ahead, we anticipate a smaller impact on performance as we expect yields to stabilize in the near term. At the same time, improving EMD fundamentals, supportive technical conditions, and attractive valuations […]

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Reactions to the Reflation Trade

Thomas Clarke, Partner

In February, following a global yield spike, it seemed like everyone started talking about inflation, and, in recent months, global markets have been influenced by the so-called “reflation trade,” which has appeared to have affected the performance of certain equities and currencies. But what does that mean for our exposures? Inflation or Reflation? “Reflation” is […]

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Inflation or Deflation? Yes

Brian Singer, CFA, Partner

There has been much discussion lately about whether we will have inflation or deflation, and I think the answer is “yes.” We’re experiencing inflation already, and we’ll likely experience it more, both cross-sectionally and longitudinally. But, as economies recover from the pandemic-induced recession, deflationary pressures may also come into play. Cross-Sectional Inflation: Here, There, Not […]

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The Digitalization of Japan

Jayesh Kannan, CFA

Japan is one of the most wired countries in the world, but cloud adoption is less than half of what it is in many other countries, and fewer than 10% of government administrative procedures in Japan can be completed online. Something is getting lost in translation, as we saw in Sofia Coppola’s 2003 film, and […]

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Financial Services Dispersion Creates Opportunity

Daniel Hill, CFA

On the surface, financial services may look like a sleepy sector dominated by well-established institutions and networks. But for fundamental, active investors trying to uncover opportunities for sustainable value creation, financial services is anything but boring. In addition to having a vast total addressable market (TAM), financial services is defined by rapid innovation across a […]

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Diagnosing the Future of Healthcare

Thomas A. Sternberg, CFA, Partner

For some time now I have been discussing a few key areas in which the healthcare landscape could change, including gene therapy and liquid biopsy. Then COVID-19 struck, and we saw the landscape change, with growth accelerating in many other areas. Hospitals are increasing ICU capacity to address pandemic preparedness, for example, and tech giants […]

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3 Opportunities in a Crowded World

Brian Singer, CFA, Partner

Trades seem to be getting more and more crowded, and some investors are concerned that a bubble is being or already has been created. They are wondering whether focus should be shifted away from areas that have seen unusually large appreciations in the recent few quarters and toward less crowded exposures. To start, we believe […]

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Two Steps Back in Turkey

Thomas Clarke, Partner

Our assessment of the Turkish lira (TRY) has substantially changed in a short period of time. The credibility of the TRY, which had been won back at great expense during the past few years, has again been crushed by Turkish President Recep Tayyip Erdogan. And we cannot conclude that this time the credibility can be […]

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Credibility Crisis in Turkey

Daniel Wood

Following a commitment to more policy orthodoxy in late 2020, Turkey appears to have once again suddenly changed direction with the sacking of Central Bank of Turkey Governor Naci Agbal and the appointment of Sahap Kavcioglu as his replacement over the weekend. Investors will now be focused more closely on the outlook for asset prices […]

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Brazil Rate Hike: A Sign for Emerging Markets?

Lewis Jones, CFA, FRM

Last week the Central Bank of Brazil kicked off a rate-tightening cycle following a sharp rise in inflation in recent months, making it the second major emerging market (EM) to raise interest rates since the start of the COVID-19 pandemic. What happened—and is it is sign of things to come across EMs? Turkey was the […]

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Connected Commerce: Beyond Bricks and Clicks

Jayesh Kannan, CFA

The world is not just being recreated click-by-click instead of brick-by-brick; it’s being reimagined. In the second installment of our Convergence series, which examines five growth themes that are shaping the future of investing, Hugo Scott-Gall spoke with Global Research Analyst Jay Kannan, CFA, about what we call “connected commerce,” which covers the entire architecture […]

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China's Unwavering Growth Journey

Vivian Lin Thurston, CFA, Partner

China led the world into the COVID-19 pandemic and was the first country to emerge. As we look ahead to the remainder of 2021, what does the modern Middle Kingdom have in store? We asked Vivian Lin Thurston, CFA, partner, a portfolio manager on our China A-Shares Growth strategy, and Clifford Lau, CFA, a portfolio […]

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6 Themes Driving Emerging Markets Debt

Marcelo Assalin, CFA

Emerging markets (EM) debt could benefit in 2021 from a favorable combination of factors—such as improving global growth and ample liquidity conditions—but adding to our optimism is our belief that several important themes will likely unify the landscape for EM debt. These include the weakening U.S. dollar, a changed U.S-China relationship, supportive commodity prices, and […]

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Emerging Markets: Localized Opportunities

Todd McClone, CFA, Partner

While we are favorable on the overall outlook for emerging markets (EMs), there is a wide disparity in the pace and stage of their recoveries from economic disruptions caused by the COVID-19 pandemic. While gross domestic product (GDP) expectations for all EMs decreased significantly because of the pandemic, this delta is significantly smaller for countries […]

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A Changing Tide Supports International Investing

Alaina Anderson, CFA, Partner

Expectations for earnings growth and return on invested capital (ROIC) have become more favorable outside the United States—and our outlook for growth in key industries suggests accelerating demand and emerging business models abroad. An analysis of aggregate growth and returns outside versus inside the United States provides some insight into the performance differential we have […]

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Emerging Markets Debt Well Supported

Marcelo Assalin, CFA

After an extremely challenging 2020—a year that will go down in history as one of the most difficult periods in modern times—we expect a strong global economic recovery in 2021, as already indicated by the rapid rise of Purchasing Managers’ Indices (PMIs). While the recovery has been led by robust economic growth in advanced economies […]

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Bullish on Emerging Markets Equities

Todd McClone, CFA, Partner

As we get further into 2021, we are more bullish on emerging markets (EM) equities than at any point in the past decade. After bouts of volatility in early 2020 caused by disruptions related to the COVID-19 pandemic—and a subsequent rapid recovery—we see room for strong growth in developing markets in 2021. Several factors are […]

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Fishing in Bigger Ponds

Alaina Anderson, CFA, Partner

Company-specific factors, including what we call “sustainable value creation,” are increasingly more important than country-specific factors, and companies that deliver strong sustainable value creation are increasingly found outside the United States. Quality Drives Returns While the United States should continue to provide opportunities for high-quality growth-stock investing, the universe of high-quality growth stocks outside the […]

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2021: The Strongest Growth in a Generation?

Olga Bitel, Partner

Charles Dickens’s timeless quote—“It was the best of times, it was the worst of times”—may come to characterize the global economy of the early 2020s quite accurately. The COVID-19 pandemic wreaked havoc on the global economy. The brunt of the decline occurred in the second quarter everywhere except in China, where activity declined mostly in […]

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Emerging Markets Roar Into the 20s

Stephanie Braming, CFA, Partner

Emerging markets (EM) equities and debt suffered along with other assets when the COVID-19 pandemic set off a global economic shock. As we look ahead, it is important to understand where we are—a global economy in the midst of a pandemic, but also one with significant opportunity and hope. In 2020, the human race faced […]

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Photography: Investing in a Memory

The Active Share
The Active Share Podcast

Investing in a photograph means investing in its power to affect the viewer. Join William Blair’s Hugo Scott-Gall and Simon Fennell for a conversation with Michael Hoppen, CEO and founder of the Michael Hoppen Gallery, as we review photography as an art form and its ties to society, discuss the impact of technology on photography, […]

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The Green Wave in Fixed Income

Todd Kurisu, CFA

Since sustainable (“green”) bonds were first introduced, the fixed-income market has seen the confluence of three events: increased demand from asset owners looking for sustainable strategies; more data showing improved risk/return characteristics for sustainable bonds; and increased interest by issuers. Today, these bonds have become more mainstream. Exceptional Growth in Green Bonds Since early 2019—when […]

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Winds of Change May Reduce Near-Term Risk

Thomas Clarke, Partner

Our total equity exposure is currently a bit above our long-term expected average, reflecting our view that a number of headwinds have cleared. Over the past few years, our equity exposure has trended below our average level, but we made a deliberate change during the second half of 2020, increasing our equity exposure to current […]

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Three Pillars of International Investing

Alaina Anderson, CFA, Partner

Today’s investors may be handicapping their return potential by not considering international stocks, which remain an important part of a diversified equity portfolio. An active approach to international investing unlocks a broad opportunity set, allowing investors to search for the best investment ideas around the world. And we believe portfolios constructed with this in mind […]

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EditGenetics: Improving Lives

Thomas A. Sternberg, CFA, Partner

Harnessing technology to solve known problems in healthcare and food is something we’ve been exploring in depth. In the first installment of our Convergence series, which examines five growth themes that are shaping the future of investing, Hugo Scott-Gall spoke with Global Research Analysts Tommy Sternberg and Ben Loss to discuss aspects of what we […]

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Can We Talk?

The Active Share
The Active Share Podcast

What do cricket and investing have in common? A lot more than you think. Join William Blair’s Hugo Scott-Gall and Simon Fennell for a conversation with Tim Harkness, sports psychologist and author of “10 Rules for Talking: An Expert’s Guide to Mastering Difficult Conversations,” and hear how his rules can help improve your personal and […]

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3 Lessons From 2020

Ken McAtamney, Partner

While reviewing the prior year and forming an outlook for the market, it is impossible not to take greater stock of the world events and think more broadly about lessons learned during this time, which has been unlike any other we have experienced in our lifetimes. As we consider these lessons, it is informative to […]

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The Where-Why-How of the Democratic Sweep

Ross Hambrick, CFA

As the 2020 U.S. election cycle finally comes to a close (only a 2020 election cycle could extend into 2021), we reflect on the results and the impacts they will have through the three stages of our investment process: Where, Why, and How. As a reminder, we assess risks and opportunities in the global markets […]

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Is Energy Still Attractive?

Brian Singer, CFA, Partner

We currently have a favorable view of the energy sector, which is largely driven by attractive fundamentals. However, there are many considerations beyond fundamental valuation that should be taken into account, including stranded assets and an increasing focus on environmental, social, and governance (ESG) factors. Stranded Assets Should Drive Write-Downs Oil companies draw on reserves […]

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Networks: The Rails That Connect Digital Payments

Daniel Hill, CFA

Now that we’ve discussed the role merchant acquirers and issuers play in the global payments ecosystem, which offers access to a truly enormous addressable market, we’d like to move on to networks—the rails that connect other aspects of the payments ecosystem—so we can better understand investment opportunities and risks in this segment. The Rails That […]

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Active Perspectives on Global Utilities

Alaina Anderson, CFA, Partner

Global utility stocks are typically considered defensive in nature because the dependable reoccurring cash flows they generate make them somewhat bond-like. Watch the video or read the recap below. Stocks in global utilities are typically thought to be quite defensive in nature because the dependable reoccurring cash flows they generate make them somewhat bond-like. Global […]

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Industrials Resilient Amid COVID-19

Yan Krasov, CFA, Partner

The COVID-19 pandemic has caused sudden and widespread disruption of activity across many sectors previously thought to be economically resilient. Watch the video or read the recap below. The COVID-19 pandemic has caused sudden and widespread disruption of activity across many sectors previously thought to be economically resilient. However, the executives running companies within the […]

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U.S. Election Shifts Power in Asia

Aaron Balsam, CFA

We recently updated our Asia Game Theater—which helps guide our understanding of security and trade-related issues within the region—to reflect the change in the United States presidency.

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Our Edge in Local Currency

Daniel Wood

Emerging markets are complex and rapidly changing, and successfully navigating them requires the focus and skill of a dedicated investment team.

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Convergence: 5 Growth Themes Shaping the Future

Hugo Scott-Gall, Partner
Ken McAtamney, Partner

The world is rapidly changing: Enabling technologies are becoming less expensive and more powerful, innovative business models are capturing growing markets by offering value-added products and services, and in turn, societal norms are evolving in response. But what does it mean for investors and how does it affect our investment mindset? We wanted to know, […]

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The Case for Local Currency Emerging Markets Debt

Lewis Jones, CFA, FRM

We expect emerging markets (EM) debt issues in local currency to outperform other fixed-income asset classes in coming quarters, and several factors underpin this positive forecast. Watch the video or read the recap below. Investors have two primary options when it comes to investing in EM sovereign debt. They can choose dollar-denominated bonds or those […]

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Luck of the Draw

The Active Share
The Active Share Podcast

Is success the luck of the draw? Tune in as Hugo speaks with Michael Sandel, a professor of political philosophy at Harvard University. Michael has authored several books, including “What Money Can’t Buy: The Moral Limits of Markets,” “Justice: What’s the Right Thing to Do?” and most recently, “The Tyranny of Merit: What’s Become of […]

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How COVID-19 Changes China

Vivian Lin Thurston, CFA, Partner

We have consistently been attracted to three investment themes in China—healthcare, consumer, and technology—and believe COVID-19 enhances the opportunities they present. Watch the video or read the recap below. We have consistently been attracted to three investment themes in China: consumer, healthcare, and technology. All three themes are further enhanced by COVID-19 developments. Consumer. As […]

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What's Ahead for Emerging Markets Debt?

Marcelo Assalin, CFA

The overall picture for emerging markets debt (EMD) remains clouded by uncertainty around COVID-19, yet we remain constructive on the outlook for the asset class and anticipate strong performance going into year-end. The bad news stems from COVID-19, including its impact on near-term growth and the potential for further lockdowns, particularly in the United States. […]

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4 Reasons for Optimism

Thomas Clarke, Partner

This year is no exception to the rule that investing through a fundamental lens often requires patience, but we are optimistic that these fundamental opportunities may be realized in the coming quarters. Fundamental value is the foundation of our philosophy and process, and because value is a long-term concept, investing through a fundamental lens sometimes […]

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Impact! U.S. Elections

Olga Bitel, Partner

The U.S. election season is in full swing, and the implications for economic growth prospects and market returns are more elusive and more profound than any market moves in the early days of November may imply. Economic and social policies can improve or undermine our economy and society, and their effects cumulate over many years. […]

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Grappling With Gridlock: U.S. Election Update

Ross Hambrick, CFA

As we approach Election Day in the United States, polls and betting markets have seen some movement but the story is much the same: According to betting markets, Joe Biden has about a 60% chance of winning. If that result plays out, how will it affect our positioning? While the presidency matters for certain things, […]

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Navigating Uncertainty: Elections and COVID-19

Robert Lanphier, Partner

It’s often said that “we live in interesting times,” and that phrase certainly applies today. A U.S. presidential election is just days away. A global pandemic is strengthening in intensity, with the timing and effectiveness of promised vaccines unknown. And social unrest is bursting forth without geographic prejudice. All are legitimate concerns for investors given […]

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Untangling Misconceptions About Inflation

Olga Bitel, Partner

Investors are preoccupied with inflation for good reason: It affects interest rates, public-equity valuations, private-equity access to capital and, ultimately, stock-price multiples. The recent policy change announced by U.S. Fed Chairman Jerome H. Powell to allow inflation to run at an average rate of 2% over time, rather than setting that figure as a strict […]

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ESG Resilient Amid COVID-19 Crisis

Romina Graiver

The commitment of companies and investors to environmental, social, and governance (ESG) factors has been stress-tested during the COVID-19 crisis, but has shown resilience. Watch the video or read the recap below. Investment demand for ESG integration has accelerated over recent years, with a special focus on environmental issues given rising risks of climate change. […]

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Active Perspectives on Global Real Estate

Alaina Anderson, CFA, Partner

Global real-estate stocks have performed poorly given uncertainty surrounding the dependability of cash flows as we navigate the COVID-19 pandemic. But as crisis forces adaptation, we look for innovation from well-capitalized and thoughtful real-estate operators as well as consolidation across property types. Watch the video or read the recap below. Global real estate stocks have […]

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Low Duration for Enhanced Cash Management

Ruta Ziverte

Rates are zero-bound, and today, everyone seems to be looking for yield. But as prime money market funds close and government money markets produce limited yield, investors have been forced to seek alternatives to cash management. We view high-quality, low-duration strategies as one such alternative to enhanced cash management. We employ continuous active management to […]

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Sustainable Trends Supporting China A-Shares

Vivian Lin Thurston, CFA, Partner

China A-shares—the domestically listed equities of mainland Chinese companies—have been extremely resilient during the current crisis, outperforming other emerging market (EM) and developed market stocks. We attribute their strong performance in part to a number of interrelated factors and sustainable trends that support our positive outlook for the asset class and our preferences within it. […]

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COVID-19 Accelerates Trends in Emerging Markets Corporate Debt

Luis Olguin, CFA

As an asset class, emerging markets corporate debt has shown quite a bit of resiliency. Longer term, we think the COVID-19 crisis will likely accelerate trends that were already underway.

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Investing in the Next Generation

The Active Share
The Active Share Podcast

In this episode, Rendel Solomon, managing director at Muller & Monroe Asset Management and founder of One Stock One Future, joins our moderator, Hugo, for a conversation on Rendel’s family history, his “One Stock One Future” initiative, which aims to turn 1 million underprivileged young people into public company shareholders, and the widening racial wealth […]

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Navigating the Macro Environment

Lotta Moberg, Ph.D., CFA

The current environment opens up a number of opportunities for managers who look at fundamental value, but it also forces navigation. Watch the video or read the recap below. The current environment certainly opens up a lot of opportunities for fundamental value, and it also forces a lot of navigation. Take, for example, emerging markets, […]

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Part 3: COVID-19 Science and Economics

The Active Share
The Active Share Podcast

In the third installment of our COVID-19 series, our moderator, Hugo Scott-Gall, co-director of research on the Global Equity team, checks back in with our in-house COVID experts, Research Analyst Camilla Oxhamre Cruse, Ph.D., and Global Strategist Olga Bitel, on why cases are rising in some areas and declining in others, where we are on […]

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ESG in EMD: People Drive Performance

Luis Olguin, CFA
Yvette Babb
Yvette Babb and Luis Olguin, CFA

Having lived and breathed in emerging markets has given us an understanding of emerging debt markets and keen insight into how developments are likely to unfold —including environmental, social, and governance (ESG) factors. In this third part of a three-part series, we explain the origins of our passion for the asset class and how we […]

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Digital Payments Issuers Face Regulatory Risk

Daniel Hill, CFA

Now that we have discussed the role merchant acquirers play in the global payments ecosystem, which offers access to a truly enormous addressable market, we’d like to move on to issuers—the banks that issue credit and debit cards and the issuer processors that are either internal functions within banks or are banks’ external partners. By assuming credit risk, banks […]

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2020 U.S. Election Primer

Ross Hambrick, CFA

With fewer than 100 days until the U.S. presidential election, prediction markets currently give Joe Biden a 60% chance of winning. A Biden win could have implications for policy—including taxes, spending, and healthcare—but only if the Democrats also take control of the Senate.  Polling Data Given that U.S. presidential elections are not really national elections […]

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Positioning for a Weaker Dollar

Daniel Wood
Lewis Jones, CFA, FRM

The U.S. dollar faces downward pressure due to a combination of macro and technical factors, and we believe a key beneficiary of this trend will be investors in sovereign emerging markets debt (EMD) that is denominated in local currencies. Several factors—a rising growth advantage, light market positioning, and attractive valuations in both bonds and foreign […]

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Plant-Based Protein: No Mainstream Penetration

Rita Spitz, CFA, Partner

Plant-based protein is not a fad. But it likely won’t materially change the food landscape, either—in great part because penetration isn’t mainstream. As we explained previously, plant-based protein is a source of nutritional protein derived from plants. This can include pulses, tofu, soya, tempeh, seitan, nuts, seeds, grains, and peas. This includes nondairy milks, such […]

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How We Stop Wasting Food

The Active Share
The Active Share Podcast

Getting surplus food into the mouths of the hungry is more complicated than it seems. Join our moderator, Hugo, and portfolio manager, Simon, for a conversation with Laura Winningham, CEO of City Harvest London, which has rescued 4,000 tons of surplus food and delivered 10 million meals to those in need. Laura’s comments are edited […]

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More Competition for Merchant Acquirers

Daniel Hill, CFA

Merchant acquirers—the initial gatekeepers in a digital transaction—present compelling investment opportunities. They are part of an industry that offers access to a truly enormous addressable market across the world, and varying global penetration creates opportunities for active managers. But they are not without risks. The Gatekeepers Previously, we explained that the global payments ecosystem consists […]

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Developing Leaders in Asset Management

Alaina Anderson, CFA, Partner

As one of the few women of color in portfolio-management roles across the industry, Alaina Anderson knows the importance of being proactive and intentional about developing diverse leaders in asset management. In the Q&A below, she discusses how she moved from a small-cap consumer analyst to a portfolio manager and partner. Why is breaking into […]

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Follow the Money in Digital Payments

Daniel Hill, CFA

Although digital payment transactions take only seconds to complete, there are different layers and numerous players interacting behind the scenes that make that phenomenon possible. To appreciate the investment opportunities in this space, it is important to understand the business models involved and how money flows through the system every time consumers swipe a credit […]

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The Spread Over Sovereign Framework

Luis Olguin, CFA
Mariana Villalba, CFA

As the emerging markets hard currency universe has evolved from an asset class predominantly composed of sovereign debt to a more diversified one including sovereigns, quasi-sovereigns, and corporate debt, opportunities to create better risk-adjusted portfolios using corporate debt have emerged. Adding Corporates to Portfolios: A Systematic, Risk-Managed Approach The hard currency emerging markets debt (EMD) […]

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Sportswear: Sweet Success Amid COVID-19?

Kwesi Smith, CFA

As a discretionary good, sportswear may seem an unlikely winner in the wake of COVID-19. But the category—which includes athletic apparel and footwear—has some unique characteristics that make us think it will emerge just fine. In fact, for stronger companies, we believe COVID-19 will be an accelerant as the companies leverage their connections with consumers […]

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Digital Payments and Aerospace—Diverse Growth Opportunities

Ken McAtamney, Partner

New-economy digital business models proved resilient and defensive amid the pandemic-induced collapse in economic activity, and this widening performance differential is particularly interesting to us as investors in industry-leading growth companies. We are also interested in some of the more compelling structural growth companies in cyclical industries that have been particularly affected by the economic […]

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Outlook for Sovereign Debt Restructurings

Daniel Wood
Jared Lou, CFA

Historically, a combination of high yield and minimal default risk has led emerging markets debt (EMD) investors to enjoy strong returns—but the impact of COVID-19 has called into question the potential for such favorable returns in the future. Historically speaking, however, markets have overestimated the probability of default and underestimated eventual recovery rates. Defaults Priced […]

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Sector Insights in India

Anil Daka, CFA
Bryan Shea

The tailwinds—and headwinds—to development in India are affecting the investment landscape in distinct ways across sectors. The common theme, however, is that as digital connectivity unlocks new sources of growth and as the playing field in India becomes more level from a policy perspective, high-quality companies may have more opportunity to expand their competitive advantages. […]

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Tailwinds (and Headwinds) in India

Daniel Hill, CFA
William Benton, CFA, Partner

India, the world’s second-largest country by population, is home to 1.3 billion people, about half of whom are below age 25, meaning that a huge number of Indians will be entering their prime in terms of productivity and consumption over the coming decade.1 The appealing size of India’s total addressable market (TAM) is undeniable, but […]

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Plant-Based Protein: More Than a Fad?

Rita Spitz, CFA, Partner

Earlier this year, a major global food and agriculture company announced the launch of private-label plant-based meat products, which will help retail food and foodservice businesses more easily capture a share of the growing plant-based protein market. That said, the company has also invested $7 billion in animal protein over the past five years, which […]

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Disruption and Growth in Digital Payments

Daniel Hill, CFA

The digital payments industry offers access to a truly enormous addressable market across the world, and varying penetration across regions and countries creates opportunities for active managers. But disruption is always a consideration when analyzing an industry, and this threat varies significantly across the segments of the digital payments industry. The global payments ecosystem consists […]

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Active Perspectives on India's Evolution

D.J. Neiman, CFA, Partner

In India 2020: A Vision for the New Millennium, A.P.J. Abdul Kalam and Y.S. Rajan detailed how India could become a developed country and one of the world’s four largest economies by 2020. But how is the India 2020 vision holding up in 2020? With the world’s second-largest population, a democratic government, and a capitalist […]

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Leadership: One GOALLLLLL!

The Active Share
The Active Share Podcast

Strong leadership, especially during uncertain times, is more important than ever.  Join our moderator, Hugo Scott-Gall, co-director of research on the global equity team, for a conversation with Jill Ellis, former head coach of the U.S. Women’s National Soccer Team, on creating a dynamic environment, making sound decisions, and working with diverse personalities. Jill’s comments […]

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Small-Cap Value: Ignored but Not Forgotten

Matthew Neska, CFA

Being a value investor has been challenging over the past 13 years, and there have been echoes of “value is dead” within the marketplace. But history has shown that investors who stick with value during challenging times could be rewarded. The Case for Small-Cap Value Financial research has widely documented that within equities, value investing […]

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COVID-19 Drives ESG Demand

Blake Pontius, CFA

Investor demand for environmental, social, and governance (ESG) integration has increased rapidly across regions and asset classes in recent years and is now poised to accelerate in the wake of COVID-19. To help frame the ESG outlook from here, it is important to consider which factors contributed to greater investor adoption of sustainability objectives before […]

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10 Things the Pandemic Could Change

Ken McAtamney, Partner

Many of the long-term structural changes to the U.S. economy resulting from COVID-19 will depend on the post-pandemic assessments that are made by policymakers and the political reception of their actions. This process really has not yet begun to play out, but in the meantime, we have begun thinking about the ways the world—and investment […]

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5 Factors Driving Digital Payments Growth

Daniel Hill, CFA

While we sometimes find compelling investment opportunities in obscure corners of the market, we also discover them by looking closely at something that is an integral part of our everyday lives. Such is the case with the global digital payments industry, the multifaceted and complex financial transaction ecosystem that allows individuals around the world to […]

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Paths to Recovery

Olga Bitel, Partner

In determining where the current economic slowdown is likely to end up, it helps to consider the potential paths to recovery. Will the recovery be V-, W-, U-, or L-shaped? We will talk about why we are modeling the recovery the way we are, where the potential pitfalls are, and what the different bull/bear scenarios […]

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Attractive EMD Entry Point After COVID-19 Shock

Marcelo Assalin, CFA

The COVID-19 shock to the global economy has sent emerging markets debt (EMD) spreads to levels not seen since the global financial crisis. We believe this rise in EMD’s risk premium is overdone and underappreciates the fundamentals of the asset class, creating potential opportunities and an attractive entry point. A Technical Sell-Off Emerging market (EM) […]

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