Citywire Switzerland quizzed fund managers with proven track records and Citywire ratings on the themes and stocks they're backing. Follow the managers predictions throughout the week.
Put on the spot to name his best pick among emerging markets equities, RAM Active Investments’ CEO Thomas de Saint Seine chooses the Taiwanese technology sector as his best bet. The Citywire A-rated manager of the RAM EM Core and EM Equities funds has been overweight the country for the past two years and believes it offers a series of growth opportunities that are benefitting from the boom of the smartphone market.
‘The Taiwanese information technology sector is enjoying a strong momentum. Smartphone components’ providers are significantly benefitting from the growth in this area,’ he says.
‘These companies target both the high end consumer as well as cheaper products. In the future, we might take profits if valuations become too expensive.’
Among his favourite stocks he names the electronics manufacturing company Hon Hai Precision, which, according to him, is taking advantage of the growth coming from India and China. ‘Taiwan is an excellent proxy to get exposure to Chinese growth. Several companies have factories in China and are developing their international presence.’
Another company favoured by Saint Seine is Pegatron, which is specialised in the production of iPhone screens and is benefitting from Apple’s growth.
In regards to China, the CEO is not moving according to the recent money flows that market has witnessed. ‘It’s time to be more selective in China. The economy has suffered from an over-investment bubble which will take time to be reduced.’
He also says Chinese stocks’ behaviour is not very rational at the moment. ‘We still find good opportunities in the infrastructure sector given the degree of maturity of the current economic cycle.’
Over the past three years to April 2015, the RAM Emerging Markets Equities fund, which de Saint Seine co-runs with Citywire A-rated Emmanuel Hauptmann and Maxime Botti, returned 27.19% in USD terms. This is while its Citywire benchmark, the MSCI EM index, rose 11.19% over the same timeframe.
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