LatinFinance - May/June 2015 - 15

EQUITY SCORECARD

A year to forget
Most fund managers in LatinFinance's 2015 Equity Investor
a bit more clarity on that end."
Scorecard say they focus on a bottom-up formula for choosing
Will Landers, emerging markets portfolio manager at BlackRock,
the companies they take a stake in. Rather than looking at
is another bearish voice. Brazilian companies may record local
macroeconomic expectations in various parts of the region and
currency profit increases this year, he says, but the fall in the
determining allocations from there, these portfolio managers
Brazilian real is likely to wipe out any gains for international
scrutinize each company individually to make their decisions.
investors.
The strategy is behind some less than obvious calls by the
"Generally speaking we'll continue to be more positive
funds in the Scorecard. Aberdeen Global's Latin America Equity
on Mexico versus Brazil for the next year, given its gradual
fund had around 61% of its investments in Brazil in early April.
improvement, and the fact that I don't think earnings forecasts
Senior investment manager Fiona Manning acknowledges the
in Brazil have caught up to the new reality of what the economy's
positioning is contrarian, but says good value is to be found.
actually doing," says Landers.
"Brazil is by far the broadest and deepest market, and we see
He adds a caveat. "But you've got to be careful with that Brazil
lots of great companies that are looking a bit beaten up," she says.
call. If the politics continue to shift towards a more market friendly
The fund still takes a disciplined view, however: Manning notes
environment, then people can look through a year, year-and-a-half
that Aberdeen sold some holdings in Ultrapar last year in a profitof bad growth."
taking move after strong performance.
Indeed, Ángel Ortiz, portfolio manager of Fidelity Funds' Latin
To compensate for its Brazil bias, Aberdeen's fund held fewer
America equity fund, points to "early signs of positive change"
Mexican assets than the benchmark. And in its holdings there,
which could improve Brazil's prospects in the medium term. New
the fund also takes a sometimes contrarian view. It topped
Finance Minister Joaquim Levy "could herald the start of muchup its portfolio in Walmex last year "when it was pretty out of
needed change," says Ortiz. He sees value in consumer-related
favor", Manning says. That was driven by a long-term bet on the
businesses such as Ambev and BRF in Brazil, and Femsa in Mexico,
company's ability to turn around its Sam's Club business.
he adds. LF
Luis Carrillo, head of the Latin America Group in JPMorgan
Asset Management's emerging market equities
Stacking up
team, also sees potential for opportunity in Brazil,
LatAm Equity Benchmarks
particularly with a cheaper currency and low
corporate valuations. Still, he is keen to see greater
clarity on the normalized rate of growth and whether
the policy changes in motion today could become
something bigger.
"If they're reforms, the magnitude of the
opportunity changes significantly," he says. "But we
need to see if they want to go to the next step. We need

Net returns (%)
1-year

3-year

5-year

10-year

-7.44

-2.38

1.24

9.73

BOVESPA (Ibovespa) TR

-28.37

-23.22

-16.49

4.8

Lipper Global Equity Emerging Markets LatAm

-20.67

-13.13

-7.24

4.74

Mexico IPC CR

Source: Lipper. Data to 31 March 2015

Who's losing least
2015 Equity Investor Scorecard
LatAm
allocation (%)

Assets ($m)

Latin America

94.2

Deutsche

Latin America Equity

Handelsbankens

Latinamerikafond

4

JPMorgan

Latin America Equity

90.74

974

-18.22

-9.9

5

Baring

Latin America

91.9

326

-16.63

-9.93

6

Aberdeen Global

Latin America Equity

96

743

-21.88

-10.37

7

HSBC

Latin America Equity

95.82

109

-21.88

-10.38

-5.72

8

BlackRock

Latin America

94.23

244

-16.57

-10.8

-5.58

9

Invesco Perpetual

Latin America

95.89

327

-22.06

-10.94

-4.99

9.29

10

Fidelity Funds

Latin America

94.53

1,060

-18.92

-11.01

-4.33

10.43

Manager

Fund

1

First State

2
3

Gross returns (%)
1-year

3-year

159

-13.81

-5.77

90.65

321

-18.06

-7.94

98.49

324

-19.9

5-year

10-year

-9.68

-4.77

8.4

-3.78

10.5

10.07

Source: Lipper. Data to 31 March 2015

May/June 2015 - L ATINFINA NCE.COM 15


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LatinFinance - May/June 2015

Table of Contents for the Digital Edition of LatinFinance - May/June 2015

Contents
LatinFinance - May/June 2015 - Cover1
LatinFinance - May/June 2015 - Cover2
LatinFinance - May/June 2015 - Contents
LatinFinance - May/June 2015 - 2
LatinFinance - May/June 2015 - 3
LatinFinance - May/June 2015 - 4
LatinFinance - May/June 2015 - 5
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