Seafarer Overseas Growth & Income Fund Inv Cl · NASDAQ:SFGIX
Seafarer Overseas Growth & Income Fund Inv Cl — Seafarer Overseas Growth and Income Fund — Investor Presentation (December 2013)
28 slides from Seafarer Overseas Growth & Income Fund Inv Cl's investor presentation, Dec 12, 2013
Slide 1: Shareholder Conference Call
For those of you who know me, I tend to run on a bit in conversation; so this summary edition of the presentation offers highlights from Seafarer’s shareholder conference call. My own notes are on each page in red font. - Andrew Foster Shareholder Conference Call! ! Seafarer Capital Partners, LLC! !
Slide 2: Disclosures
Disclosures! ALPS Distributors, Inc. is the distributor for the Seafarer Overseas Growth and Income Fund. Kate Jaquet and Michelle Foster are Registered Representatives of ALPS Distributors, Inc. This material must be accompanied or preceded by a prospectus. View the Fund’s prospectus at www.seafare
Slide 3: Agenda
Agenda! 1. Fund Retrospective 2. A Change in the Model – An Economic Discussion! 3. What You See Is All There Is – An Index Discussion! 4. Around the World in 5 Minutes! 5. Question and Answer Session! 2
Slide 4: Fund Retrospective – The Past Five Months
Fund Retrospective – The Past Five Months! Seafarer Overseas Growth and Income Fund! SFGIX Net Asset Value (NAV)! $12.50 ! (2/15/12 - 12/11/13)! In January 2013, we voluntarily 4th Distribution! reduced the expense ratio of the 39.5¢ ! Fund by 20 basis points; in August, $12.00 ! we converted that v
Slide 5: Monthly Performance
Monthly Performance! As of 30 November 2013! We’re proud of the performance since inception, but ! recognize that the opportunity cost vs. investing in the U.S. has been high … Total Return Total Return Since Inception NAV / Net Inception Index Level 1 Mo 3 Mo YTD 1 Yr Annualized Cumulative Expense
Slide 6: Quarterly Performance
Quarterly Performance! As of 30 September 2013! This page shows the performance table again, but as of ! the end of the third quarter Total Return Total Return Since Inception NAV / Net Inception Index Level 1 Mo 3 Mo YTD 1 Yr Annualized Cumulative Expense Date (9/30/13) Ratio1 SFGIX (Investor Class
Slide 7: Source of Performance
Source of Performance! SFGIX - Contribution to Net Asset Value! GICS Sectors - from Inception to End 3Q13! (2/15/12 - 9/30/13)! This chart shows the Fund’s NAV movement, reconciled $0.09! $0.03! $0.33! against standard $0.14! $0.10! “GICS” (Global Industry $0.16! $0.25! Classification System) sector
Slide 8: Agenda
Agenda! 1. Fund Retrospective 2. A Change in the Model – An Economic Discussion! 3. What You See Is All There Is – An Index Discussion! 4. Around the World in 5 Minutes! 5. Question and Answer Session! 7
Slide 9: Structural Change Underway – In Fits and Starts
Structural Change Underway – In Fits and Starts! Brazil China India Two Steps • Infrastructure concessions • Liberalization of the local currency • Monetary policy reform Forward and interest rates (“backdoor” • Anti-corruption efforts • Relaxation of quotas on foreign reforms of the domestic bankin
Slide 10: Economic Landscape of the Developing World
Economic Landscape of the Developing World! This chart offers a high-level overview of the Emerging Markets! economic structure of the emerging world Estimated Value Added by Category! Historically, governments in developing Fiscal Year 2011! countries favored export-led economies Energy + Commoditi
Slide 11: Goods Versus Services
Goods Versus Services! Emerging Markets! Estimated Value Added by Category! A further breakdown on a basic dimension: Fiscal Year 2011! tangible goods (red dashed line) versus intangible services (blue dashed line) Energy + Commodities! 17%! Industrials, Notice the very high contribution of Manufact
Slide 12: A Blast from the Past
A Blast from the Past! U.S. Gross Domestic Product (GDP)! 1947! … Yet there is one decent analogue in our view: the U.S. economy, all the way back in 1947 Industrials, Manufacturing, Macro-economic statistics Goods & Resources! were systematically captured 40%! only in the post-WW2 era, so this char
Slide 13: Room to Grow?
Room to Grow?! U.S. Nominal Economic Output! 1947 - 2012! (1947 GDP = 1)! 100 ! Services (Private Sector + Government)! Goods! 2012 Services! 90 ! 87x Increase! $12.7 Trillion! 80 ! This is why we think the comparison matters: look 82% of Total! how much the service sector expanded in the U.S. over
Slide 14: The Emergence of the Service Sector
The Emergence of the Service Sector! China Nominal Economic Output! 2002 - 2012! 2012 Services! (2002 GDP = 1)! 4.6x Increase! 5.0 ! $3.7 Trillion! Goods (Primary + Secondary Industry)! Services (Tertiary Industry)! 45% of Total! 4.5 ! Surprisingly, something similar might be happening in China 2012
Slide 15: Agenda
1. Fund Retrospective 2. A Change in the Model – An Economic Discussion! 3. What You See Is All There Is – An Index Discussion! 4. Around the World in 5 Minutes! 5. Question and Answer Session! 14
Slide 16: What You See Is All There Is (WYSIATI)
What You See Is All There Is (WYSIATI)! • WYSIATI is a behavioral fallacy. WYSIATI hinders decision-making: humans instinctively assume that what they initially perceive is meaningful or representative.1 • Investors assume benchmarks are “neutral.” Classic benchmarks place an emphasis on measurement
Slide 17: Much More Than Meets the Eye (MMTMTE!)
Much More Than Meets the Eye (MMTMTE!)! This table compares the raw, unfiltered emerging markets universe (at left) with the (filtered) universe of one of the prevailing emerging market benchmarks (at right) ESTIMATED TOTAL CAPITALIZATION MSCI EMERGING MARKETS INDEX % of Total Capitalization Number
Slide 18: The Valuation Landscape
0! 5! 10! 15! 20! 25! 30! 35! ! Oil Gas & Consumable Fuels! Automobiles! ! ! ! ! ! ! Commercial Banks! Semiconductors & Semiconductor Equipment! Auto Components! Real Estate Management & Development! Water Utilities! Metals & Mining! Electric Utilities! Distributors! Average P/E = 10.3! 28% of Const
Slide 19: Valuations & Economic Structure
Valuations & Economic Structure! To see why we’re not necessarily Note, though, that P./B for EM 2.0 daunted by higher valuations on the MSCI Emerging Markets Index! is still at a substantial premium EM 2.0 industries (blue bars), we Economic Category Valuation ! need to examine a bit of history Pri
Slide 20: The Great Divergence
The Great Divergence! Not surprisingly, the market has awarded a Yet we are not terribly bothered by valuation premium to the EM 2.0 4.0 ! the premium, because we think it is MSCI Emerging Markets Index! categories – consumer goods (light blue) justified – and the market agrees, for Economic Categor
Slide 21: Index WYSIATI – Playing Catch-Up
Index WYSIATI – Playing Catch-Up! The index’s emphasis on replicability and scalability means that it lags the market MSCI Emerging Estimated Total Estimated cap in the EM 2.0 categories Markets Index Market Capitalization Economic Output Energy + Commodities 22% 22% 17% Manufacturing + Industrial G
Slide 22: Source of Performance, Re-Formatted
Source of Performance, Re-Formatted! SFGIX - Contribution to Net Asset Value! The data suggest that the “EM 2.0 Growth Model” has Economic Categories - from Inception to End 3Q13! (Compare this data versus (2/15/12 - 9/30/13)! contributed to the Fund’s the original “GICS” sector performance to date
Slide 23: Agenda
1. Fund Retrospective 2. A Change in the Model – An Economic Discussion! 3. What You See Is All There Is – An Index Discussion! 4. Around the World in 5 Minutes! 5. Question and Answer Session! 22
Slide 24: Around the World in 5 Minutes
Around the World in 5 Minutes! • Emerging Markets: Currencies and fixed income are the focal point of financial distress this year. As we surmised, a mini-bubble burst in EM fixed income. But there is no looming solvency crisis, as was the case in the past. Lack of growth is the real problem. With s
Slide 25: Agenda
1. Fund Retrospective 2. A Change in the Model – An Economic Discussion! 3. What You See Is All There Is – An Index Discussion! 4. Around the World in 5 Minutes! 5. Question and Answer Session! 24
Slide 26: Question and Answer Session
Question and Answer Session! To submit a question, ! visit seafarerfunds.com, ! and select the “Submit a Question” link on the homepage.! ! 25
Slide 27: Glossary
Glossary ! AUM Assets under management. Chinese A-Shares Securitized shares in mainland China-based companies that trade on Chinese stock exchanges such as the Shanghai Stock Exchange and the Shenzhen Stock Exchange. A-shares are generally only available for investment by domestic Chinese parties (e
Slide 28: seafarerfunds.com
seafarerfunds.com!
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