Emerging Markets

“Markets have indeed changed, and all of those risks that I mentioned now describe any country in the world, not just emerging markets and developed markets are somehow the bastions of the opposite of all of those things.”

“I now have come to the realization that it's a hard perch, high hurdle to leave the U.S., take my one marginal dollar and invest in country X in the emerging markets and expect a competitive risk-adjusted return.”

“In the emerging markets years back, if you were a global multinational brand, you had a halo of which you didn't feel you could get domestically. That certainly has changed.”

“1.2 billion young people in the emerging markets are going to become 18 years of age in the coming Mutomati 15 years. Right? Yeah. Currently, the same markets, currently, this is pre-AI, and we can talk about AI's impacts on the developed world versus the de…”

“Morgan did the first voluntary loan for debt exchange in emerging markets.”

“There was a long period of time, 2010 to 2024, when what was happening in the world in terms of interest rates and the US dollar was so important that it overwhelmed what was happening in a lot of countries.”

“One of the things I had known about emerging markets is emerging markets is a horizontal activity. I had built it at JPEEP as a horizontal standalone activity. It was not a fixed income subsidiary, not a subsidiary of equities or of anything else. It was its o…”

“The non-government bond part of the fixed income market in emerging markets is multiples in size of the bond market.”

“It will be those investors who are smart enough and flexible enough to see that the combination of number of countries, number of underlying markets, number of cycles does not match up well with certainly monoline investing. And that that also does not match u…”

“You can absolutely build something passive that will get you a higher sharp ratio than the underlying index. I have no doubt about that. And I have very little doubt about it, although we haven't done it specifically for the other asset classes. It may have a …”

“The fact that EM is a niche and remains a niche for all the mega investors, investment firms that are out there, emerging markets is an afterthought. I promise you it is an afterthought. I don't care what they say, and it always will be because it's small.”

“The deal flow in emerging markets Will not support mono asset class, single country, sub-regional funds, and therefore the people who raise that money end up deploying it badly.”

“If you had done that over the last 15 years, over roughly 20 countries, and you were right 60% of the time, in a fifteen-year bear market for emerging markets, you would have lost money in one year.”

“Scenario analysis is much more important than standard deviations. Because in many of those scenarios, it was a six standard deviation event.”

“Number two, on public markets, the most important thing from a risk management point of view is to have a currency capability, because currency liquidity almost never goes away in emerging markets.”

“There was a period of time where of all the private money being invested in emerging markets around the world, 90% of that money went to Asia, of which 90% went to China. This concentration, 81% of all private investing money In emerging markets flowed to one …”

“Having everything under one roof is far superior if they are incented and cultured to work together. Because if you have A good FX person next to a good, even public market equity person. Both of those will generate better returns for sitting next to each othe…”

“I think that people inaccurately in holding, let's say, the U.S. As the benchmark for rule of law, for sanctity of contract, for this, for that, unfairly denigrate a lot of these other places because there are rules in all of these places. There are laws in al…”

“I think the biggest multi-asset class fund in public markets is the hundred billion dollar fund. The biggest one in emerging markets is eight hundred million dollars. There are only five that I can find.”

“In private markets, you're starting to see multi-asset class in developed markets. You have not seen it yet in emerging markets at all.”

“So I do think that in the next 10 years, those who achieve some level of a diversification will be rewarded because I do think there's a little bit of froth in the U.S. Market and the opposite in a lot of the emerging markets.”

“And recently we have scaled back over the past few years, we actually scaled back our allocation to emerging markets. It's still reasonably large compared to many funds. I think we're about 15%, but it's not as large as it once was. And a lot of our appetite f…”

“One of the areas that we have gravitated away from over the years is take emerging markets, for example. So the sovereign risk, the macro risk often are the most important risk in any asset you're looking at in a specific emerging market. We don't think we're …”

“If you look at the Western countries today most governments lose election there whereas in emerging markets, in developing countries of late, most incumbents are winning their elections which is the big difference that's happened.”

“I'm saying that as a small portion to what I think, but otherwise most of my capital is international today. My own portfolio. It's mainly emerging markets. And even Europe.”

“In emerging markets I've always believed that getting the country right is very important. Country. And then at the end of the day, Like you have to buy the best quality companies in that country, but if you get the country wrong, then if you're investing in A…”

“What's happening right now in the U.S., and I don't want to be too facetious or critical, but the U.S. Is starting to trade in many ways like an emerging market.”

“There are two macro hedge funds dedicated to emerging markets today. Two of them. There's none doing commodities.”

“No, because the US is not growing at seven percent like India and like other countries. The great thing about emerging countries, emerging markets, Is that they're growing at a fast pace, double that of the US and developed countries.”

“In emerging markets, we're often addressing a problem that customer doesn't even define it as a problem. They don't even know this is a problem. It's just, this is just the way the world works. There's no way to solve this problem. If we can help them become p…”

“All of our emerging markets we do externally.”

“In emerging markets, consumers are not willing to trust companies, and so you have to build a brand to a certain size and scale, and then they'll start enabling trust to be able to try multiple products. It's why you see so many companies like a la Zomato, not…”

“My second prediction, ties back to a company I just named, is that SaaS will continue to grow and it will even pick up space in emerging markets.”

“Hard currency for me is one of the more analyzable asset classes of EM at the country level.”

“There are plenty of those where you've seen a significant transition to policy setups that are very similar to developed markets, and that is not something that reaches a lot of headlines, but it is something that has been happening in the past 20 years, I wou…”

“If you look at just a simple measure of standard deviation of spreads in EM, it is almost at historical highs.”

“No matter how good the entrepreneur is, fuck it, sorry, if the market is so challenged, which emerging markets are right now. There are great businesses in emerging markets, which will never raise because all us cash is golf for anywhere in the majority of eme…”

“People started paying, like, seed rounds at twenty million dollar valuations, and in, in a market that's gonna be a really tough path to get to a billion dollar plus exit.”

“We're humble enough and cautious enough to know that if you don't live in a country, if you don't have people that are active in that country, you're at a real disadvantage, and so I have no idea what the premium should be for buying Equities in Africa, equiti…”

“They were very early in the 19 nineties into private equity. They were also early into the aughts in emerging markets. And when I was there right after 2010, they were looking to pivot into the frontier markets.”

“Well, my biggest mistake was investing in emerging markets.”

“I think one of the big theses that I have learned in this traveling is that which is happening among emerging markets among themselves is more shared in many cases than their compatriots in Silicon Valley or even Beijing.”

“Even the big juggernauts in some of these regions have learned that they are as much an aggregation of local companies as they are just one stop shop in terms of what they offer.”

“When there's so much capital that kind of floods into an ecosystem that does de-risk it to some extent.”

“From my experience in a lot of countries that I've been to, being a foreigner and opening a business in that country, focusing on that economy is a really bad idea because you're just going to get destroyed by other companies that know the language and have re…”

“There's two billion individuals in emerging markets that have Android devices, but it's also in terms of just the price point. You know, now you can get a smartphone for under 25 dollars in these countries.”

“Just watch us create five, ten billion dollar plus companies, global companies out of the emerging markets. It's going to happen automatically. You know, FOMO. FOMO will take care of it.”

“But I think if we're continuing to develop those resources in industrialized markets, it's kind of hard to say, like, well, don't do it in these markets that are still emerging.”

“Richard Lawrence, who is, for me, the ultimate emerging market guy. He's probably the best equity guy in emerging markets in not one, but two or three generations.”

“Emerging markets is not a good buy and hold marketplace, but between being macro informed, more alpha opportunity, more short opportunities, it's a good place to own hedge funds.”

“When you look at those markets, though, my counter would be, one, fund flows probably matter more than fundamentals. Two, things like rising US interest rates are particularly bad for emerging markets or speculative markets of any kind, but particularly emergi…”

“The level of innovation, the level of hard work, the ambition I saw there was mind blowing, and I was blind to it up until one year before, and I think many of us are blind, so the level of ambition that Chinese companies have in emerging markets, it's undenia…”

“The developing market investors have stopped investing in emerging markets and frontier markets, as you might suspect during a downturn. And they're even pulling money out.”

“About a hundred trillion of that debt globally is in emerging markets.”

“Also, I find that in a lot of these markets, especially in emerging markets, the equity markets are really the most inefficient markets. They tend not to react as quickly as the currency or the debt.”

“I think that the question of being an investor in the emerging markets comes down to a very simple question. Are you getting paid for the risk of the volatility? And at times, frankly, the answer is yes. But I'd say generally, our experience suggests that you'…”

“The single biggest difference between emerging markets and basically some of the so-called like Western countries is the severe. Unefficiency in supply chain management that we see in emerging markets.”

“So you see this, you know, this dislocation in the market is not a climate tech dislocation. It's a it's candidly going from, like, risk on to seeing a lot of those, you know, risk on bets pull back. I mean, you're seeing it hit Everything from, you know, our …”

“More or less, the U.S. Return is about 10 and a half percent. Non-U.S. Developed market equities close to six percent. Emerging markets slightly above developed market equity at about six and a half percent. So that's a 400 basis point under performance during…”

“Over that long period of time, the economic growth hasn't, Clearly translated into profit growth. And it's been a, from a beta standpoint, it's not been an attractive asset class to be invested in for that extended period of time.”