Mark Mobius is such a successful mutual fund manager that he even landed himself a lead role in a popular Japanese manga. His current roles in the financial world include that of Executive Chairman of Templeton Emerging Markets Group, a unit of mutual-fund giant Franklin Resources. He oversees around $40 billion in assets (via MarketWatch).
Mobius is a pioneer of emerging market investments, a specialty that didn't bode well for most of his peers in 2011. Indeed, the market volatility in the USA and eurozone, along with their corresponding economic issues, made the somewhat dependent emerging markets a riskier investment choice.
Euro and emerging market rebound
Investors originally felt emerging markets would see a sharp decline in growth, but they've become more optimistic since the New Year -- believing all the euro negativity had already been priced in -- and the markets have made a nice rebound.
"There are challenges [to the euro], such as member countries' need to control government spending, but once these are sorted out, I believe the euro should be very successful and, in fact, it could possibly play a greater role in the global economy in 2020," Mobius said.
Mobius' strategy investing on the trend
Many things can go right, or wrong, with the eurozone, United States, emerging markets, and the connections between them. Mobius is taking no chances -- he's positioning his portfolios for any possibility.
"He's invested in cyclical areas such as energy, commodities and materials, as well as having large investments in food and other staples that wealthier consumers can now afford," according to MarketWatch.
Here are his 5 "Money Moves." Specific stock recommendations are listed below.
1. Energy Sector: Energy demand goes hand in hand with economic development and urbanization. From cellular towers to office towers, "everybody needs electricity," he says.
2. Software Developers: "Some terrific software companies in India do global software and outsourcing work ... They're a beneficiary of the global outsourcing trend." These countries have the experience and qualified world force to control and globally expand the industry.
3. Financial Services: Thanks to emerging markets' experience with debt troubles and "challenging economic environments" they may come out ahead as some of the most experienced, and undervalued, banking/financial service sectors. "Mobius said he sees opportunities in emerging-market financial services firms with strong balance sheets and a focus on consumers."
4. Consumer Goods: When traveling through these emerging nations he's noticed that shopping centers are filled with people. He thinks consumer companies, electricity providers, material suppliers stand to benefit from this. "I'd love to buy consumer companies in China, but many of them are very expensive." So he's taking a look at cheaper food companies in Brazil.
5. Commodities and Materials: "China and India together represent more than one-third of the world's population -- has created an unprecedented need for food and raw materials," reports MarketWatch. To which Mobius adds "Commodity stocks continue to look good because we expect the global demand for commodities to continue its long-term growth." Examples are oil, iron ore, aluminum, copper, nickel and platinum, sugar, meat, corn, soybeans, cocoa, and select grains.
Here are the stocks on the U.S. exchanges that Mobius discusses. (Click here to access free, interactive tools to analyze these ideas.)
1. Companhia de Bebidas Das Americas (Nasdaq: AMBEV ) : Engages in the production, distribution, and sale of beer, draft beer, carbonated soft drinks, malt, and other non-alcoholic and non-carbonated products in the Americas. Market cap of $115.20B. Relatively low correlation to the market (beta = 0.4), which may be appealing to risk averse investors. The stock has gained 10.17% over the last year.
2. Banco Bradesco (NYSE: BBD ) : Provides a range of banking and financial products and services to individuals; large, small, and mid-sized companies; and local and international corporations and institutions. Market cap of $70.57B. Relatively low correlation to the market (beta = -0.04), which may be appealing to risk averse investors. The stock has had a good month, gaining 16.11%.
3. Anheuser-Busch InBev (NYSE: BUD ) : Engages in brewing and selling beer in North America, Latin America, Europe, and the Asia Pacific. Market cap of $99.75B. Relatively low correlation to the market (beta = 0.13), which may be appealing to risk averse investors. The stock has gained 14.34% over the last year.
4. Infosys (Nasdaq: INFY ) : Provides information technology (IT) and consulting services worldwide. Market cap of $29.88B. Relatively low correlation to the market (beta = -0.25), which may be appealing to risk averse investors. The stock has lost 4.91% over the last year.
5. Itau Unibanco Holding (Nasdaq: ITUB ) : Provides commercial, corporate, and investment banking services to individuals, small and middle-market companies, and large corporations in Brazil and internationally. Market cap of $96.45B. Relatively low correlation to the market (beta = -0.05), which may be appealing to risk averse investors. The stock has had a couple of great days, gaining 5.5% over the last week.
Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the stocks mentioned above. Analyst ratings sourced from Zacks Investment Research.
Kapitall's Rebecca Lipman does not own any of the shares mentioned above. Data sourced from Finviz.
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