Seafarer Overseas Growth & Income Fund Inv Cl · NASDAQ:SFGIX
Seafarer Overseas Growth & Income Fund Inv Cl — Seafarer Capital Partners — Inaugural Shareholder Conference Call (July 2012)
16 slides from Seafarer Overseas Growth & Income Fund Inv Cl's conference presentation, Jul 12, 2012
Slide 1: Inaugural Shareholder Conference Call
Inaugural Shareholder Conference Call Seafarer Capital Partners, LLC 12 July 2012
Slide 2: Disclosures
Disclosures ALPS Distributors, Inc. is the distributor for the Seafarer Overseas Growth and Income Fund. Kate Jaquet is a Registered Representative of ALPS Distributors, Inc. Investors should consider the investment objectives, risks, charges and expenses carefully before making an investment decisi
Slide 3: Agenda
Agenda • Overview of the global investment environment – China – Europe – Valuations in emerging markets • Discussion of Seafarer’s current strategy – Regional positioning: Asia, Eastern Europe, Latin America – Sector positioning: emphasis on service sectors • Discussion of Seafarer’s long-term stra
Slide 4: China
China • Beginning three years ago, we recognized that China’s growth was slowing – but not stopping! – particularly as the local economy underwent a critical transition. • Our base assumption is that China’s growth will be attractive over the next five years (averaging about 6%, but ranging between
Slide 5: Europe
Europe • The news that Europe is moving to recapitalize its banks from a pooled financial resource is the first material, constructive news to emerge in the past year, in our view. However, the arrangements have not yet been finalized, much less put into action. • Europe’s financial problems stem fr
Slide 6: Europe (Continued)
Europe (Continued) • Such exits will very likely create temporary volatility among emerging markets; however, we believe that valuations in emerging markets are quite low, such that they already reflect all but the most dire scenarios. • We place very low probability that catastrophic events unfold
Slide 7: Valuations
Valuations • Equity valuations in emerging markets are relatively attractive, in our view, particularly within the emerging Asia region. Current valuations for emerging markets are as follows: Emerging Markets1 Forward price-to-earnings multiple, based on forecast estimates 11.1 Trailing price-to-bo
Slide 8: Strategy – Regional Positioning
Strategy – Regional Positioning As of 30 June 2012 ADRs, Common & Preferred Equities Only Avg Market Earnings Per Price / Price / Region Holdings (#) Net Assets (%) Capitalization Share Growth Book2 Earnings 2 (USD $ BL)1 (%) 2 Investment Portfolio 42 98 9 1.7 11 12 East & South Asia 33 77 11 1.6 11
Slide 9: Strategy – Sector Positioning
Strategy – Sector Positioning As of 30 June 2012 ADRs, Common & Preferred Equities Only Avg Market Earnings Per Price / Price / Sector Holdings (#) Net Assets (%) Capitalization Share Growth Book2 Earnings 2 (USD $ BL)1 (%) 2 Investment Portfolio 42 98 9 1.7 11 12 Consumer Discretionary 1 2 3 3.3 15
Slide 10: Strategy – Anticipate the Benchmark
Strategy – Anticipate the Benchmark • Seafarer’s research on the prevailing benchmark index for emerging markets suggests that it has certain structural shortcomings. There is a mismatch between the index’s structure and that of the underlying fundamentals of the markets. • Specifically, the index’s
Slide 11: Divergence: Index vs. Fundamentals
Divergence: Index vs. Fundamentals Index-Based Market Economic Portfolio* Capitalization Output ** East & South Asia China (inclusive of Hong Kong) 18% 38% 37% India 6% 9% 14% Rest of East & South Asia 36% 22% 16% Sub-total 60% 68% 66% Eastern Europe Russia 6% 6% 7% Rest of Eastern Europe 3% 3% 7% S
Slide 12: Big Picture: Reality vs. Index
Big Picture: Reality vs. Index Average of (Market Cap & Econ Ouput) Minus Index 7% Index Underweight Fundamentals 2% Index Overweight Fundamentals -4% -5% East & South Asia Eastern Europe Latin America Middle East & Africa Source: Seafarer. 11
Slide 13: Convergence with Fundamentals
Convergence with Fundamentals East & South Asia Latin America 70% 70% 60% 60% 50% 50% 40% 40% 30% 30% 20% 20% 10% 10% 0% 0% 1997 2011 1997 2011 Index Allocation Fundamental Allocation Index Allocation Fundamental Allocation Middle East & Africa Eastern Europe 70% 70% 60% 60% 50% 50% 40% 40% 30% 30%
Slide 14: Fund Performance
Fund Performance Quarterly Performance as of 30 June 2012 Cumulative Total Return NAV / Index Level Since Inception Net Expense 1 Month 3 Month (6/30/12) Inception Date Ratio1 SFGIX (Investor) $9.97 6.04% –2.61% 0.21% 2/15/12 1.60% SIGIX (Institutional) $9.99 6.09% –2.66% 0.26% 2/15/12 1.45% MSCI Em
Slide 15: Glossary
Glossary Dividend Yield (Trailing 12-Mo) a measure of the sum of the dividends paid per share during the trailing 12 months divided by the current share price. Earnings Per Share Growth (EPS Growth) forecast growth rate of earnings per common share this year (or, if noted, next year), expressed as a
Slide 16: seafarerfunds.com
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