MutualFundWire.com: LATimes Profiles a Thornburg Guru

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Monday, July 8, 2013

LATimes Profiles a Thornburg Guru

With the MSCI emerging markets index down 14 percent this year, a developing world fund has succeeded. Thornburg's [profile] Developing World Fund has been up 3 percent this year and beat 96 percent of its peers, despite the China slowdown and political turmoil in Brazil, reported The Los Angeles Times' Stuart Pfeifer. Morningstar gave the fund a five star rating.

Pfeifer interviewed the PM, Lewis Kaufman, who used to work for Morgan Stanley and Citigroup.

Kaufman said he decides what is an emerging market stock, not on where the company is based, but who the company sells to, which is why 12 percent of its assets are invested in Remy Cointreau, Prada, Colgate-Palmolive.

We see opportunities in companies that are oriented or levered to domestic demand trends in the emerging markets. Prada is 65%, 70% in the emerging markets. People are going to brush their teeth. They're going to migrate to the global brands like Colgate-Palmolive.

Kaufman sees a lot of long term growth in Southeast Asia as well:

Southeast Asia is only 10% of the MSCI, but our fund is 21% in those countries. Indonesia, Philippines and Thailand are the three big ones. I think that is one of the few regions in the world with the potential to surprise from a GDP perspective in the next few years.