17 Comments

Comprehensive write-up, thanks. With its share price having declined further since the write-up, amidst all the downgrades from the sell-side analysts currently, any strong view at the current price?

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Good piece, Guy, makes a lot of sense.

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Great summary, thank you! Also good comments and your thoughtful response to comments just adds to the original piece. The tricky issue for me is summarised in your comment "At the end of the day, it's a cyclical business. I think earnings growth will come when EM has a sustained bull market and managers are forced to turn their underweights into overweights." I find that EM call particularly hard to make, especially when so many so-called 'macro' experts can't seem to get it right.

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They talk about growing dividends but the dividend has been the same for years, 0,17. I'm missing something?

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Great note - thanks. Definitely worth a look. I'm curious about the reduction in AUM from 2020/21 to 22/23. Do we know how much of this was redemptions/ouflows vs losses in the underlying? Also, have you spoke to mgmt. about their perception of the stock price (given it's been flatish since IPO) Thanks!

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Would imagine at least some of the AUM drawdown was just due to rising rates.

Guy, what do you mean when you say they were contrarian during covid, and it cost them?

Thanks! Really interesting idea.

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By the way, I think the fees you quote are actually margins. That's what the presentation says. Looking at their retail funds, most of the AUM seems to be in funds with c.1.5% fees. I'm sure it's lower for institutions. They make a good case that you can't invest passively in EM bonds because 85% of them aren't in an index, but 1.5% still eats a lot of the spread over DM bonds. My view is that what this really needs is a weak dollar - I am not sure the bonds themselves are cheap enough to drive meaningful allocations of capital towards Ashmore, but the currencies might well be. Interested in your thoughts.

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Presumably the bear case has been the ongoing implosion in Chinese junk bonds?

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Beautiful piece thanks. I already own this one and hold high hopes for it. I’m not convinced on performance against benchmark by a number of its funds but as you say tailwinds should gee that along. Their website offers some deep insights eg the case for local currency bonds article on 28 July

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Great write up and idea. What is the plan with the cash position?

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Thanks for sharing. I think it’s a great idea and a good valuation. I’m missing EPS growth over the years. However I opened a small observation position because I really like the story and valuation.

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deletedAug 9, 2023Liked by Emerging Value
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I think that we are nearing a cyclical bottom. The highest risk here is that I’m too early and inflation triggers more unrests in EM (Niger, etc.) resulting in further downward re-ratings but the cash position and experienced insiders should give some buffer.

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Are u invested?

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Let's talk on WhatsApp

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personally no, but I put it in watchlist and I could be in the future. It's quality and not expensive

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That makes sense. Thanks. I think the deck says retail has dropped from 15% of AUM to 4%. Might have that wrong but intuitively makes sense - retail advisory is short term and this stuff hasn’t been performing, and for the last few years the focus in the UK and Europe has almost entirely been on fees.

Ok, so we think they’re institution-dominant and institutions get much lower fees.

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