Capital Allocators – Inside the Institutional Investment Industry [REPLAY] Daniel Graña – Janus Henderson Investors Emerging Markets Equity (Manager Meetings, EP.13)
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Dec 14, 2023 Daniel Graña, who leads Janus Henderson’s emerging markets equity strategy, shares insights on the dynamic world of emerging market investing. He recounts the wild west of early days in these regions and emphasizes the importance of good governance. They discuss navigating political landscapes, including a revealing story involving a Russian oligarch, and the challenges of launching Mexico's first REIT. Daniel advocates for a nuanced approach to portfolio construction in countries like China and Brazil, blending personal values with investment strategies.
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Emerging Markets Investment Strategy
- Investing in emerging markets presents greater opportunities and risks due to varying development stages.
- Graña emphasizes focusing on the intersection of good companies, good governance, and good countries.
Critique of MSCI Emerging Markets Index
- Graña critiques the MSCI Emerging Markets Index for its heavy emphasis on state-owned enterprises and exclusion of new economy stocks.
- He advocates for expanding the investment universe beyond the benchmark.
Portfolio Construction and Risk Management
- Use standard deviations instead of point estimates when evaluating potential investments.
- Consider risk characteristics and how stocks interact within a portfolio to achieve optimal risk-adjusted returns.