Asset Allocation & Fund Positioning, Copley Fund Research

Steven Holden

Asset Allocation & Fund Positioning

Copley Fund Research

Copley Fund Research provide research and data on asset allocation among Global and Emerging Market equity funds.  The analysis details absolute and relative positioning across countries, sectors and industries together with highly granular data on single stock and single fund allocations.  The data is updated monthly with time series going back to January 2011.

Global Research - Analysis of 165 prominent Global equity funds, combined AUM $335bn
GEM Research - Analysis of 127 prominent global EM equity funds, combined AUM $250bn

Asset Allocation - Global and GEM Equity

Cross Asset Strategy

<ul>
<li>Mexico has seen increased inflows and exposure over the past 3-4 years, with funds invested reaching an all-time high of 94.6% and average holding weights climbing to 3.93%.</li>
<li>The percentage of active EM funds overweight the benchmark rose from 20% in 2011 to over 69% last month, making Mexico the largest overweight compared country peers.</li>
<li>Grupo Financiero Banorte and Wal-Mart de Mexico are key contributors to the net Mexican overweight, with Banorte seeing increased exposure of +4.26% of funds in the last 6 months</li>
</ul>


Mexico has seen increased inflows and exposure over the past 3-4 years, with funds invested reaching an all-time high of 94.6% and average holding weights climbing to 3.93%.
The percentage of active EM funds overweight the benchmark rose from 20% in 2011 to over 69% last month, making Mexico the largest overweight compared country peers.
Grupo Financiero Banorte and Wal-Mart de Mexico are key contributors to the net Mexican overweight, with Banorte seeing increased exposure of +4.26% of funds in the last 6 months


Mexico: GEM Funds Wrong-Footed After Election Results.

<ul>
<li>LATAM allocations hit 10-year highs in active Global equity funds.</li>
<li>Notable increases in allocations include Ninety One Global Value (up 7.5%) and Ranmore Global Equity (up 6.7%), with smaller contributions from Lazard, Delaware, and JOHCM</li>
<li>MercadoLibre is the driving force behind the moves higher, and remains the conviction holding in the region.</li>
</ul>


LATAM allocations hit 10-year highs in active Global equity funds.
Notable increases in allocations include Ninety One Global Value (up 7.5%) and Ranmore Global Equity (up 6.7%), with smaller contributions from Lazard, Delaware, and JOHCM
MercadoLibre is the driving force behind the moves higher, and remains the conviction holding in the region.


LATAM Momentum:  Global Funds Raise Exposure

<ul>
<li>Mexico overweight reaches record levels among active GEM investors, moves to top country overweight.</li>
<li>Mexico a beneficiary from a rotation out of Russia, Turkey and Tech, alongside Brazil and some of the MENA nations.</li>
<li>Grupo Financiero Banorte and Wal-Mart de Mexico are widely held and have been instrumental in Mexico’s rise up the ranks over the past couple of years.  </li>
</ul>


Mexico overweight reaches record levels among active GEM investors, moves to top country overweight.
Mexico a beneficiary from a rotation out of Russia, Turkey and Tech, alongside Brazil and some of the MENA nations.
Grupo Financiero Banorte and Wal-Mart de Mexico are widely held and have been instrumental in Mexico’s rise up the ranks over the past couple of years.  


Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

iShares MSCI Emerging Markets / Technical Analysis

<ul>
<li>Indexes have plunged since violating our "lines-in-the-sand" of 3875 on EURO STOXX 50, 14,815 on the DAX, $54 on ACWI ex-US (ACWX-US), $75.25 on EAFE (EFA-US), and $99 on ACWI(ACWI-US).</li>
<li>More recently, Japan’s TOPIX broke below the key 1840 level, as the number of countries breaking down increases.</li>
<li>We remain bearish at the index level as long as these indexes continue to make lower highs, and we expect that any bottoming process would take weeks/months to develop.</li>
</ul>


Indexes have plunged since violating our "lines-in-the-sand" of 3875 on EURO STOXX 50, 14,815 on the DAX, $54 on ACWI ex-US (ACWX-US), $75.25 on EAFE (EFA-US), and $99 on ACWI(ACWI-US).
More recently, Japan’s TOPIX broke below the key 1840 level, as the number of countries breaking down increases.
We remain bearish at the index level as long as these indexes continue to make lower highs, and we expect that any bottoming process would take weeks/months to develop.


Monitoring For A Bottom; Focus On Defensives

Thematic (Sector/Industry)

<p>Mexican Consumer Staples stocks are gaining traction with active EM investors.  Last month saw the net overweight reach a new high of +0.43% with a record 52.6% of funds overweight the iShares MSCI EM ETF.</p><p>Despite this, absolute positioning in Mexican Consumer Staples is relatively low versus history.  This analysis looks at the potential for Mexican Consumer staples to run further, attracting more investors and becoming a greater allocation within active EM portfolios.</p>

Mexican Consumer Staples stocks are gaining traction with active EM investors.  Last month saw the net overweight reach a new high of +0.43% with a record 52.6% of funds overweight the iShares MSCI EM ETF.Despite this, absolute positioning in Mexican Consumer Staples is relatively low versus history.  This analysis looks at the potential for Mexican Consumer staples to run further, attracting more investors and becoming a greater allocation within active EM portfolios.

Mexico Consumer Staples:  Overweight, Underowned, Strong Momentum

Mexico

Wal-Mart de Mexico S.A.B. de C.V. retails food, clothing, and other merchandise under a variety of store formats. The Company operates Wal-Mart Supercenters, Sam's Club wholesale outlets, Bodega discount stores and Superama supermarkets.

Wal-Mart de Mexico SAB de CV (WALMEX* MM EQUITY)

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Wal-Mart de Mexico SAB de CV (WALMEX* MM EQUITY)

Mexico: GEM Funds Wrong-Footed After Election Results.

Pre-election bullishness towards Mexico was at it's highest ever levels in the run up to the election. Managers must now assess whether the new...

Steven Holden

LATAM Momentum: Global Funds Raise Exposure

LATAM allocations hit 10-year highs in active Global equity funds. . MercadoLibre the driving force behind the moves higher, and remains the...

Steven Holden

Mexico Moves to Top EM Overweight

Mexican exposure among EM investors grinds higher. Rotation among managers moves Mexico to the largest country overweight in EM, with current...

Steven Holden

Monitoring For A Bottom; Focus On Defensives

Defensive Sectors including Consumer Staples, Health Care, and Utilities are emerging as leadership -- add exposure. Today we are focusing on...

Vermilion Research

Mexico Consumer Staples: Overweight, Underowned, Strong Momentum

Mexican Consumer Staples stocks are gaining traction with active EM investors. Last month saw the net overweight reach a new high of +0.43% with a...

Steven Holden

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)