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GQG Partners Emerging Markets Equity
GQG Partners is one of the newest and fastest growing asset management businesses, having launched in 2016. Rajiv Jain, founder of the company and lead manager of this fund, has over 25 years’ investment experience. GQG Partners Emerging Markets Equity is a concentrated portfolio of high quality companies with durable earnings. The emphasis is on future quality, rather than companies which have simply done well historically.
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Rajiv Jain, Lead Manager Rajiv is the Chairman and Chief Investment Officer of GQG Partners, where he leads all investment strategies. He joined GQG Partners in June 2016 and brings over 25 years of investment experience. Previously, Rajiv was Co-Chief Executive Officer and Chief Investment Officer at Vontobel Asset Management, where he managed international and emerging markets equities and helped grow assets from under $400 million to nearly $50 billion. He started at Vontobel in 1994 and earlier worked as an International Equity Analyst at Swiss Bank Corporation. Rajiv holds an MBA in Finance and International Business from the University of Miami, a master’s degree from the University of Ajmer, and an undergraduate degree in accounting with honors.
Brian Kermanc, Co-Manager Brian is a portfolio manager for all GQG Partners strategies and was the deputy portfolio manager for the International Equity strategy from 2019 to June 2022. He has been a senior investment analyst at GQG Partners since joining in 2016. Before GQG Partners, Brian worked at Jennison Associates for six years, focusing on sectors like real estate, aerospace, and automotive as part of the Small/Midcap Equity Research team. He started his career at Brown Brothers Harriman in 2008. Brian holds an MBA from Rutgers University and a BA in Economics from the University of Connecticut.
Sudarshan Murthy, Co-Manager Sudarshan is a portfolio manager for all GQG Partners strategies and was deputy portfolio manager for the Emerging Markets Equity strategy until June 2022. He has been with GQG Partners since 2016 as a senior investment analyst. Before joining the firm, Sudarshan worked for five years as a generalist analyst in Asian equities at Matthews International Capital and as a sell-side research associate at Sanford C. Bernstein. His early career included operational roles in IT services, including five years at Infosys, where he assisted the Chairman and helped launch the company’s life sciences business. Sudarshan earned an MBA from Wharton (Palmer Scholar), a Post Graduate Diploma in Management from IIM Calcutta, and a Bachelor of Engineering from NIT Surathkal. He is also a CFA charterholder.
Siddharth Jain, Deputy Manager Siddharth Jain, based in New York, is an Investment Professional at GQG Partners. He previously worked at Warburg Pincus LLC and PJT Partners. Siddharth holds a Bachelor's degree in Economics from the University of Chicago and has strong skills in research, financial analysis, financial modeling, and Microsoft Office applications.
Rajiv Jain, Lead Manager Rajiv is the Chairman and Chief Investment Officer of GQG Partners, where he leads all investment strategies. He joined GQG Partners in June 2016 and brings over 25 years of investment experience. Previously, Rajiv was Co-Chief Executive Officer and Chief Investment Officer at Vontobel Asset Management, where he managed international and emerging markets equities and helped grow assets from under $400 million to nearly $50 billion. He started at Vontobel in 1994 and earlier worked as an International Equity Analyst at Swiss Bank Corporation. Rajiv holds an MBA in Finance and International Business from the University of Miami, a master’s degree from the University of Ajmer, and an undergraduate degree in accounting with honors.
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Quote from the Fund Manager
I strongly believe that a portfolio manager should be invested in their own products because that gives you very good perspective on how they’re likely to behave.
Rajiv Jain
Lead Manager
Investment process
Idea generation for GQG Partners Emerging Markets Equity begins with a proprietary quantitative screen. This filters an initial global universe of 50,000 stocks to just 300 to 350 for further research. Examples of the attributes screened for include stable financial and solid balance sheets; profitability; efficiency; sustainable businesses and liquidity.
The team then ranks the pool of names on a 1-10 basis (10 being the best) on each of the screening criteria. The weighted average of these scores gives an overall quality rating. The results of the screen, which is run on a monthly basis, are a source of ideas for further qualitative research.
Once a potential idea is identified, further research is conducted on its drivers of success; barriers to entry; sustainability of the industry; effectiveness of management; the regulatory environment and customer behaviour. Analysts perform financial statement analysis on the names they cover, and model estimated earnings potential over the next five years.
The team includes an accounting specialist who will examine the accounts in greater detail to find potential yellow and red flags and, in addition, GQG likes to hire some analysts with a background outside finance in a ‘non-traditional’ approach. As such, the analyst team includes a number of former investigative journalists. This gives it insights outside the traditional Wall Street sell-side model and allows the team to see potential risk others may miss.
Once a business is deemed high enough quality, it is valued based on earnings estimates for the next five years. A stock is only purchased when it is trading at a significant discount to the intrinsic value estimate.
Risk
The fund is concentrated and benchmark agnostic but there are some guidelines. Maximum position sizes are limited to 7%, the fund must own at least 5 different sectors at all times and there is a maximum overweight to any one country of 20%.
ESG
ESG - Integrated
GQG takes an integrated approach that factors ESG considerations into the analysis of potential portfolio companies. GQG believes long-term earnings potential is often tied to a company’s ability to adapt to a changing marketplace and, in the context of ESG, to the emerging challenges facing the environment and society. The managers place great importance on a strong corporate culture and find that companies which demonstrate this quality tend to score higher on ESG metrics because they are focused on resiliency and sustainability over the long term. GQG aims to go beyond traditional research, looking at the intangible elements that impact a company’s long-term value.
This fund is supported by a team of analysts with experience in investigative journalism who can carry out in-depth research and uncover aspects of a company that are often overlooked. The team also uses ESG ratings from Sustainalytics in its initial stock screening process. Discretion is used when considering investing in a stock which may be involved in a controversial industry or practice. The team also engages with the management teams of the companies owned within the portfolio.
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