adviser only
Aubrey Global Emerging Markets Opportunities
This fund invests in companies offering products and services to the upwardly mobile, ambitious and aspirational population centres which account for over 70% of the world’s growth. Preferred areas include the travel, education, healthcare and e-commerce sectors, and there is a focus on firms which either have dominant or first-mover advantage. These companies will also have repeatable business models, low levels of debt and be realising attractive cash generation.
Our Opinion
Fund Managers
Expand
Fund Managers
Close
Andrew is the Founder, Director, and CIO of Aubrey, and leads the Global Emerging Markets and Global Equity strategies. A Cambridge University graduate, he began his career at Cazenove & Co before joining James Capel in 1987 and moving to Hong Kong with James Capel (Far East) in 1991. He then worked as an Asian specialist at UBS Warburg until 1998. Andrew joined Stewart Ivory in 1998 and established the First State Global Opportunities Fund in 1999, which became his signature fund. Under his management, the fund significantly outperformed the MSCI World Index.
John is a Director at Aubrey and the Investment Manager for the Global Emerging Markets Strategy, having joined the firm in 2012. A graduate of the University of Strathclyde with a BA in Economics, he is also a member of the CFA Institute. With over 30 years of experience in global equity markets, John began his career at FS Assurance in 1988, managing UK retail and pension fund portfolios. He later joined First State Investments in 2000, managing European client portfolios, before moving to Alliance Trust PLC in 2004 to manage the Global Emerging Markets portfolio.
Rob is a Director and co-Fund Manager of the GEMs strategy at Aubrey, having joined the firm in 2014. He holds an engineering degree from the University of Cambridge and started his career in 1988 at Thornton Management in London. Rob spent a decade in Hong Kong as an Asian fund manager with Credit Lyonnais International Asset Management, managing the North Asian investment team and various regional funds. He later co-founded BDT Invest LLP in London, where he co-managed several emerging market portfolios, including the BDT Asian and Oriental Focus Funds.
Andrew is the Founder, Director, and CIO of Aubrey, and leads the Global Emerging Markets and Global Equity strategies. A Cambridge University graduate, he began his career at Cazenove & Co before joining James Capel in 1987 and moving to Hong Kong with James Capel (Far East) in 1991. He then worked as an Asian specialist at UBS Warburg until 1998. Andrew joined Stewart Ivory in 1998 and established the First State Global Opportunities Fund in 1999, which became his signature fund. Under his management, the fund significantly outperformed the MSCI World Index.
Read More
Risk
Read more
Back
Company Description
Aubrey Capital Management was founded in 2006. It is an Edinburgh-based boutique with a strong active management approach, specialising in Global, European and Emerging Markets, with c.£1bn under management. It is privately owned, with the majority of shares owned by its employees. There are three senior managers at the firm, each with over 30 years' experience. They have a collaborative approach, sharing ideas amongst the team and strategies to help with the success of the whole firm.
Fund Performance
Close
Risk
Close
Investment process
Aubrey Global Emerging Markets Opportunities’ philosophy is based around the growing consumer opportunity in the emerging market regions, which incorporates 40% of global economy and 70% of its growth. These consumers are ambitious, upwardly mobile, and aspirational members of the population. The managers like dominant or first mover companies, preferring ‘local champions’ to regional versions of existing multinational firms. That being said, these companies often have business models copied from those in the West, with repeatable businesses able to generate cash.
The fund has an established watchlist of around 300 companies, built from Andrew’s and the team’s experience. This list is added to from company visits, seeing peers of existing firms and IPOs. The team also undertakes some quantitative screening for key metrics around cash generation for anything that may have been overlooked.
These ideas then go through a two-part company analysis. The first of these is to forecast financial metrics . The managers will only forecast these numbers forward for two years to ensure accuracy, with a strong focus on how and where the company generates cash.
The second part is a qualitative assessment. The team will look at the quality of the business, its position as a market leader, the company’s track record at executing its strategy and what competitive advantage it has. This thesis is verified in meetings with the company. Due to the managers' experience and Aubrey’s proactiveness in reaching out to firms, they get very good access to key people.
The best companies from this analysis creates a focused list of around 150 stocks - approximately 10 stocks per country in the benchmark. This process is often quite steady, and it may take up to six weeks to form a view on a stock. While the numbers can be prepared in a day, the team wants to spend time incorporating its opinion. The interaction with the company is key to building confidence in the investment case.
This list is then looked at through the lens of a macro overlay, which includes factors such as the political environment and changes in economic performance. This helps reinforce the investment case in a stock, which leads to a final portfolio of around 30-50 holdings.
Risk
Whilst not exclusionary, the preference for firms tapped into the growing middle classes means that large areas of the universe are overlooked as they don’t satisfy this trend. The maximum position size will be 7%, though in practice the manager will rarely go above 4-5% and will start taking profit at this point. A minimum position will be approximately 1.5%. The top ten positions will make up approximately a third of the fund, which will usually be fully invested.
ESG
ESG - Integrated
Aubrey considers ESG issues to be an integral part of the investment process. While the managers are studying their individual companies, analysts conduct in-depth analysis of ESG criteria and engage with management teams where they see risks. They have an internal bespoke framework to create scores for each investment and potential portfolio company. These are each given a risk score and weighted to create an overall portfolio score. Even when invested, the manager and analysts will engage with their companies to improve practices where they see weaknesses or risks, aiming to continually improve the ESG profile of the fund.
Aubrey bases its measures for ESG analysis on the United Nations Global Compact which provides four specific themes; human rights, labour rights, environmental concerns and anti-corruption. All this analysis operates in tandem with the qualitative assessment work on a company, and helps to build up a broader picture of the stock alongside its business operations and financial strength.
Related Insights
Three reasons to consider emerging market equities today
adviser only
Missed the China rally? Wider Asia says, no, you didn’t
India overtakes the UK as fifth largest economy in the world
adviser only
Emerging markets: Is there still an opportunity following the China rally?
adviser only
Is change in the air for emerging market investors?
The information, data, analyses, and opinions contained herein (1) include the proprietary information of FundCalibre, (2) may not be copied or redistributed without prior permission, (3) do not constitute investment advice offered by FundCalibre, (4) are provided solely for informational purposes and therefore are not an offer to buy or sell a fund, and (5) are not warranted to be correct, complete, or accurate. FundCalibre shall not be responsible for any trading decisions, damages, or other losses resulting from, or related to, this information, data, analyses, or opinions or their use. The Elite Fund rating is subjective in nature and reflects FundCalibre’s current expectations of future events/behaviour as they relate to a particular fund. Because such events/behaviour may turn out to be different than expected, FundCalibre does not guarantee that a fund will perform in line with its FundCalibre benchmark. Likewise, the Elite Fund rating should not be seen as any sort of guarantee or assessment of the creditworthiness of a fund nor of its underlying securities and should not be used as the sole basis for making any investment decision. FundCalibre disclaims any responsibility for trading decisions, damages or other losses resulting from any use of the Elite Fund rating. All performance data, as well as fund size, OCF, AMC, annual income (historic), share price discount or premium, is sourced directly from FE Analytics, and will change periodically.