Cutting exposure to India while overweighting Latin America and Russia has not paid off yet for international equities star Rajiv Jain, but he is far from worried.
In March, Jain told Citywire how he had shifted his portfolios away from India, an allocation that had been very profitable for him, and had moved to be overweight Russia, for the first time in his career, as well as Latin America.
At the time, he said: ‘We did very well with India but it is time to harvest, time to move on. I’m very excited about things in Brazil, Russia, Korea and a couple of things in Eastern Europe.’
Jain, who is chief investment officer of Fort Lauderdale, Florida-based boutique GQG Partners, said the move had ‘obviously cost the firm money this year’ but that he was not worried by this in the long-term.
‘We tend to take a three to five-year view,’ he said. ‘We talk about quality and attractiveness of price, and people sometimes forget attractive price is equally important and quality has to be forward-looking and not backward-looking.’
Jain said that for the last five years, it made sense not to overweight Eastern Europe and Latin America, but be a good bet for the next five.
‘You get paid to take what is going to happen rather than what has happened,’ he said. ‘If you take a longer view, I still like the opportunities that are being presented there.’
And it is easy to see why he is unworried. Almost everything else in his business is going according to plan.
His new firm GQG Partners, which he launched in June 2016, has amassed $5.3 billion in just one year and his joint venture with Goldman Sachs has started well.
The Goldman Sachs GQG Partners International Opportunity fund launched in December 2016 and has returned 18.2% so far this year, ahead of the MSCI EAFE’s 14%. It ranks 3rd out of 95 funds in the Citywire Multi-Cap Core category over the last three months, despite the aforementioned overweights.
The former Vontobel Asset Management co-chief executive said he was enjoying life at his own shop and that the smaller set-up allowed him to be nimble.
'You focus on things that money managers are sort of built for, i.e. performance. You can move fast in terms of decision-making,’ he said.
‘It’s a lot of fun, my regret has been why I didn’t do this sooner.’