“I don’t foresee concerns in the short term, the company is looking good around its IPO. But in the long term there are potential concerns,” he said.
One of the main issues is the number of small enterprises selling across the platform, some well-known real players and others well-known to be fake.
“Major competitor JD.com is driving economies of scale compared to the myriad of suppliers at Alibaba. And JD.com provides a far better service particularly when it comes to delivery,” he said.
He added that for both e-commerce companies the concern boiled down to the question of viability in the long-term.
In the three months to 30 June, he has adjusted the fund somewhat, increasing stocks in financials in frontier market Nigeria to 4%, alongside 6 basis points in Kenya, while trimming exposure to Russia and Brazil.
“Financials are rebounding in Nigeria, offering an 8-9% dividend yield. This could rise to 15-20%. Nigerian banks in the first quarter were somewhat lacklustre but they are continuing to look promising,” he said.
Frontier markets continue to be an active part of the portfolio for Price.
“We look to buy the best businesses, which are those with the most liquid names. The fund remains actively managed and we allocate to where we see the most opportunities,” he said.
The first quarter also saw the fund suffer from exposure to Russian stocks, which he trimmed to the extent that it is highly unlikely the remaining exposure will affect the fund.
Similarly, he trimmed exposure to Brazil, ahead of the outcome of Brazil's presidential elections this October.
“We don’t own Petrobas, which is in the index but which has an unsustainable business model,” Price noted.
India was one of the brightest stories in emerging markets, and even globally, according to Price. Commenting on the election in India, he said it was a hugely positive outcome and has increased the fund’s exposure to the market.
“All signs are towards a stronger focus on driving the economy forward. Like all emerging markets its looking cheap for a reason, and it looks like the government is looking to accelerate all public announcements.”
On quantitative easing, Price said that a stronger dollar is unlikely to be a major concern for emerging markets.
“EM are just starting to outperform developed markets. Valuations are extremely low and improving after a period of stagnation, meaning EM will look more attractive. The negativity earlier in the year was overdone – valuations on a relative basis are attractive and EM are reasonably positioned at present,” he said.
