Fund picker’s view
Damian Barry, senior investment manager, 7IM
Value investing has been out-of-favour in emerging markets for a few years now. We felt a rebound in value stocks was long overdue and that the Lazard Emerging Markets Fund would be well placed to benefit when it happened.
This year has seen a dramatic recovery in value stocks and, in line with our expectations, the Lazard fund has delivered outstanding performance.
We believe James Donald and his team are well-experienced and well-resourced to find fundamentally attractive stocks. Donald is not afraid to take a longer-term view and, to be contrarian, he has maintained a disciplined approach to value investing in the face of major headwinds.
His investment in Russia is a case in point. The team has persevered with a position in Russian stocks, despite all the news headlines, and they have been rewarded for it.
The depth and breadth of their knowledge and networks across emerging markets, gives the team an edge over many of their peers.
The main watch point from our point of view is how they manage their capacity given their large assets under management.
When a manager’s style is out-of-favour, it is easier to buy as everyone else is selling. It can be more challenging to manage growth when your investment style is in favour.
