Overstone Emerging Markets Equity Fund
A high conviction global emerging markets value equity strategy which combines fundamental bottom-up research with valuation discipline.
Investment objective
The Fund will attempt to achieve over the long term a total return in excess of that of the MSCI Emerging Markets Index (with net dividends reinvested) through investment in a concentrated portfolio of equities of companies from emerging markets and from other markets where it can be demonstrated by the Investment Manager that the company concerned is overwhelmingly an emerging market related company. The approach is focussed on valuations and bottom-up fundamental research of individual companies.
Fund particulars
Launch date | 03 November 2008 |
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Fund size | US$62.4m |
Domicile | Ireland |
Structure | QIAIF |
Base currency | USD |
Dealing | Daily |
Min. investment | €100,000 |
Benchmarks | MSCI Emerging Markets |
Portfolio manager

Tom Taylor
Tom Taylor
Tom joined OP in June 2008 from Alta Advisers Ltd. In 1999 he joined Alta Advisers, then headed by Richard Oldfield, and was responsible for managing emerging market equities portfolios. Before this he was an investment analyst at Adam & Co., based in Edinburgh. He graduated from St. Andrews University and Stirling University. He manages the emerging market portfolios and contributes to the overall investment selection.
Latest publications

Latest publications
Emerging Markets Value Equity Strategy
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Commentary
Volatility is a feature of equity markets currently and we have a higher than usual cash balance to take advantage of any opportunities over the summer months. The global economy and investor sentiment are taking a series of body blows this year. The policy responses available are not well suited to dealing with supply-side issues so could look quite ham-fisted, but they may broadly achieve their goal over time. The bad news and uncertainty are being priced into equity markets with the MSCI Emerging Markets Index trading comfortably below its historic average valuations. The upside potential for the portfolio is 80% as measured by the weighted average of the company price targets.
We often find that ‘sum of the parts’ is a useful valuation tool, and it helps identify a number of interesting opportunities currently within the portfolio. Sometimes investors have good reason to overlook an asset, but at other times the asset can just be plain overlooked. We believe some of these are quite remarkable. Embraer (Brazilian aircraft manufacturer) has the majority stake in a New York listed company called EVE, which will produce a short-range electric flight vehicle, that equals the market capitalisation of Embraer – so the traditional regional jet, business jet, and defence businesses are for free. Buenaventura (Peruvian miner) owns a 20% stake in a copper mine, Cerro Verde, that now equals its entire market capitalisation – meaning its own mines come for free. SK Square (Korean technology holding company)holds a 20%stake in SK Hynix, a leading semiconductor manufacturer, that is worth double its current market capitalisation, and in addition it has stakes in some of Korea’s leading internet service ventures. Indofood (Indonesian snack foods) owns the majority of a separate listing for its consumer foods business that is valued in excess of Indofood’s entire market capitalisation – meaning its other successful businesses in flour, agriculture, and distribution are for free. There are others such as Alibaba (Chinese Internet services), First Pacific (Hong Kong listed holding company), and Thai Beverage (Thai alcoholic beverage producer) that trade on significant discounts to a reasonable net asset value or have significant assets that are not yet accorded value by investors.
The bottom performers by contribution for the month were Buenaventura and Telkom Indonesia. Buenaventura (Peruvian miner) is falling victim to the political issues facing Peru, with the President facing a series of political challenges and destabilising the economy. The administration is not mining friendly but in its challenged state has recognised the importance of this industry for the economy. Buenaventura is transitioning towards copper, from gold, as its largest metal output, and we are positive on the long-term prospects for copper. The prices for precious metals and copper have held up well year to date. Telkom
Commentary
Indonesia (Indonesian telecom operator) is strategically well placed in mobile, broadband, and new areas like data centres. Broadband is a duopoly in Indonesia with Telkom Indonesia as the market leader and seeing strong growth. Telkom Indonesia has a strong cost control discipline, and with a rational competitive backdrop in the industry, it has a favourable pricing environment.
The top performers by contribution for the month were Petrobras and Ternium. Petrobras (Brazilian oil producer) has seen the government, its majority shareholder, react to higher domestic fuel prices by seeking to replace senior management at Petrobras (ironically that they recently appointed). This looks like a political ‘need to be seen to be doing something’, as the new management once in place continues to follow the international fuel price parity principle (as it must by law). The balance sheet has been repaired and with asset sales continuing and solid free cash flow generation from higher oil prices Petrobras is honouring its new dividend policy. Ternium (Latin American steel producer) is a beneficiary of a ‘stronger for longer’ US steel price. In addition, the Ukrainian crisis has curtailed steel exports from Russia and Ukraine to the global market. Mexico is an increasingly attractive manufacturing location boosting demand for flat steel.
Russian holdings
Please note that as of 3rd March 2022 the holding of Lukoil ADR will have a fair value price (FVP) of zero. This has been determined by our Valuation Committee. Lukoil ADR listed on the London Stock Exchange (LSE) was suspended from trading by the exchange on the morning 3rd March 2022. We will continue to monitor the situation daily and update accordingly.
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