Will diversify across countries, asset classes and industries within South America. Combines a top-down and fundamental approach, and finds many opportunities from studying currency movements.
Investing solely in South American securities and diversifies across countries, asset classes and industries in order to reduce risk. Looks for specific inefficiencies caused by currency movements, as well as market mispricing of closed-end funds, to give two examples.
Combines a top down approach with a fundamental approach, beginning with a macroeconomic analysis of countries and industries, followed up with a fundamental analysis, paying special attention to multiples and recent financial results, comparing those of companies in the same country or sector. Further diversifies with funds such as ETFs and CEFs, evaluating, most of all, their portfolios, expenses, and, in the case of CEFs, their price-to-NAV ratio.
Research includes many local Spanish and Portuguese websites as well as general news and commentaries. Examines statistics published in investing websites, and frequently transfers them to ad-hoc spreadsheets to perform comparative analysis. Finally, reads company filings, paying special attention to management discussion and analysis and competitive positioning.
The portfolio will usually remain fully invested and typically have 12 to 20 positions that will be weighted across countries, asset classes and sectors. Stock from a single company will not usually make up more than 14% of the portfolio.
Will typically sell a position when the reason for purchase no longer holds, when another opportunity arises, or in order to rebalance. Will not buy or sell based on fear or excitement.
In order to participate in fixed income, will invest in emerging market bond funds which often hold positions outside of South America as a percentage of their portfolios. May also invest in companies that are incorporated elsewhere but have a majority of their operations in South America. Finally, some of the funds may include securities in Mexico and Central America as a percentage of their portfolios.