How Baron Emerging Markets Is Winning
A few obscure stocks help propel this fund to the top.
Emerging-markets stocks have been mostly submerging the past year or so. But Baron Emerging Markets fund has managed to stay afloat and deliver a respectable return. The fund has also excelled against the competition, beating 96% of diversified emerging-markets funds over the past 12 months.
Manager Michael Kass credits Baron’s philosophy of deeply researching companies for the successful run. Doing his homework helped him find such obscure companies as Shuaa Capital, a United Arab Emirates financial firm (and the fund’s only holding in so-called frontier markets); Steinhoff International, a South African furniture maker; and China’s Sihuan Pharmaceutical. All three stocks have at least doubled over the past year.
Kass, with the help of four analysts, begins by developing big-picture themes, such as financial reforms in China and government-policy changes in Brazil. He then looks for shareholder-friendly companies that are run by entrepreneurial managers and have sustainable competitive advantages and the potential to generate long-term earnings growth. Kass or an analyst travels abroad to meet with company executives every few months.
![https://cdn.mos.cms.futurecdn.net/hwgJ7osrMtUWhk5koeVme7-200-80.png](https://cdn.mos.cms.futurecdn.net/hwgJ7osrMtUWhk5koeVme7-320-80.png)
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
The developing world is undergoing a sea change, says Kass. Growth has shifted from state-controlled companies to truly private entrepreneurial concerns. “The type of companies we own are the latter,” he says. “This is why we have this huge wind at our back.”
Get Kiplinger Today newsletter — free
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.
-
It's National 401(k) Day: Have You Checked Your 401(k) Balance?
National 401(k) Day is a great opportunity to review and if need be, revamp your 401(k), as well as any other retirement holdings.
By Adam Shell Published
-
Recent Graduate? Financial Fitness Starts Here
Once you've landed a job, it's time to optimize your starting salary with a focus on creating a budget, paying off student debt and saving for retirement.
By Vanessa Okwuraiwe Published
-
The 5 Best Actively Managed Fidelity Funds to Buy Now
mutual funds In a stock picker's market, it's sometimes best to leave the driving to the pros. These Fidelity funds provide investors solid active management at low costs.
By Kent Thune Last updated
-
The 12 Best Bear Market ETFs to Buy Now
ETFs Investors who are fearful about the more uncertainty in the new year can find plenty of protection among these bear market ETFs.
By Kyle Woodley Published
-
Don't Give Up on the Eurozone
mutual funds As Europe’s economy (and stock markets) wobble, Janus Henderson European Focus Fund (HFETX) keeps its footing with a focus on large Europe-based multinationals.
By Rivan V. Stinson Published
-
Best Bond Funds to Buy
Investing for Income The best bond funds provide investors with income and stability – and are worthy additions to any well-balanced portfolios.
By Jeff Reeves Last updated
-
Vanguard Global ESG Select Stock Profits from ESG Leaders
mutual funds Vanguard Global ESG Select Stock (VEIGX) favors firms with high standards for their businesses.
By Rivan V. Stinson Published
-
Kip ETF 20: What's In, What's Out and Why
Kip ETF 20 The broad market has taken a major hit so far in 2022, sparking some tactical changes to Kiplinger's lineup of the best low-cost ETFs.
By Nellie S. Huang Published
-
ETFs Are Now Mainstream. Here's Why They're So Appealing.
Investing for Income ETFs offer investors broad diversification to their portfolios and at low costs to boot.
By Nellie S. Huang Published
-
Do You Have Gun Stocks in Your Funds?
ESG Investors looking to make changes amid gun violence can easily divest from gun stocks ... though it's trickier if they own them through funds.
By Ellen Kennedy Published