Brazilian Blackjack: Decoding the allure of a high-risk, high-reward market
January 21, 2025 | NS Partners
This month’s commentary covers our search for a winning hand in beaten down Brazilian equities.
Unique investment philosophy
Liquidity Conditions & Country Selection
Money supply leads economy, but excess money moves asset markets earlier i.e.
Money Moves Markets (Liquidity Theory of Asset Prices)
Stock Selection Focused on Economic Profitability
Securities expected to generate high / improving economic
profitability relative to the market should outperform.
Peer Review Ensures Discipline
Revalidate, test conviction continuously; ensure tight capital discipline
(Behavioral Finance Theory)
Macroeconomic &
Liquidity Analysis
Measure countries’ sensitivity to global and domestic economic cycles and liquidity conditions
Interpret liquidity trends to establish country, sector and thematic views
Liquidity analysis informs risk appetite at a country, sector and total portfolio level
Systematic analysis of macroeconomic data, liquidity, earnings, and valuations
Qualitative analysis of politics, governance, and ‘structural’ liquidity flows
Stock Selection: Quality Growth Bias
Screen & Rank
Opinion list of approximately 200 stocks, covering
>65% of the benchmark
Screen and rank by region based on attractive
economic profitability
Identify companies with improving or stable return
on invested capital
Bottom Up Fundamental Research
Direct stock selection to countries with a favorable market environment
Focus on companies with a strong competitive advantage, leading to high economic profitability, good balance sheets with sustainable business models
Identify catalysts, risks
Develop Forecasts
Select companies expected to outperform their peer group and benefit from positive liquidity trends in country of domicile
Establish long-term view for a company, industry, and country
Continually assess growth prospects, catalysts, and risks
Structural change is where the market is inefficient
NS Partners Global
Emerging Markets Equity
A portfolio of equities in emerging
markets measured against the MSCI
Emerging Markets Net Index.
NS Partners Sustainable
Global Emerging Markets
A portfolio of equities incorporating
detailed ESG research, an emphasis
on ESG factors, and a restriction
on investments in certain sectors
and securities.
NS Partners Global
Emerging Markets Ex-China
A concentrated portfolio of equities in
emerging markets excluding China
measured against the MSCI Emerging
Markets ex China Net Index.
Insights
Read More
Chinese money update: positive signal
January 16, 2025 | NS Partners
Chinese money and credit numbers for December suggest that policy stimulus is becoming effective, warranting an upgraded assessment of economic prospects.
A “monetarist” perspective on current equity markets
January 7, 2025 | NS Partners
Global money growth remains subdued, support from a previous monetary overhang has ended, while the stockbuilding cycle is approaching a less favourable phase for risk assets.
Chinese money update: slow recovery
December 18, 2024 | NS Partners
Chinese money trends are normalising after weakness, suggesting modest economic improvement.
Weaker US business money trends
December 13, 2024 | NS Partners
Sectoral numbers show that recent US money growth has been focused on the household and financial sectors, with business holdings falling.
South Korea rocked by president’s attempt to impose martial law
December 12, 2024 | NS Partners
Political risks spike in South Korea, testing the country’s institutions, the currency and markets. The stampede into US equities continues. Is it sustainable?
UK money update: corporate liquidity squeeze
December 10, 2024 | NS Partners
Monthly UK money growth was boosted by households scrambling to dispose of assets ahead of the Budget, with a reversal likely and corporate liquidity trends worryingly weak.
Eurozone inflation: “monetarist” optimism on track
December 4, 2024 | NS Partners
Eurozone services price momentum is “unsticking” as expected, supporting the forecast of sub-2% 2025 inflation.
Global industrial momentum reviving on schedule
December 4, 2024 | NS Partners
November results confirm a September low in global manufacturing PMI new orders, with money trends suggesting a further rise through spring 2025, subject to tariff distortions.
Eurozone money update: insufficient recovery
November 28, 2024 | NS Partners
Eurozone money trends are improving but remain too weak to support economic optimism, while country details highlight French stress.
US money update: positive signal fading
November 28, 2024 | NS Partners
A pull-back in US narrow money momentum casts doubt on post-election economic optimism.
Stockbuilding cycle turning less favourable for markets
November 22, 2024 | NS Partners
The current stockbuilding cycle may be approaching its mid-point, which typically marks a shift from “risk-on” to a neutral or negative market environment.
Is Trump really bearish for EM? Plus, stock picking in a China bull market
November 16, 2024 | NS Partners
A look at the potential impact of President Trump’s policies on emerging markets, the risks of rising trade tensions with China and the resilience of China’s domestic market.
Japanese money update: downside risks rising
November 14, 2024 | NS Partners
Japanese money trends remain ominously weak, suggesting poor economic / market prospects and a return of inflation to unacceptably low levels.
Assessing “excess” liquidity: reasons for caution
November 8, 2024 | NS Partners
Flow and stock measures of “excess” money cast doubt on claims that the liquidity backdrop for markets is unusually favourable.
For additional information on NS Partners Ltd, please contact:
Brent Wilkins
Senior Vice President,
Head of Institutional Sales, Canada
Eric Hasenauer
Senior Vice President,
Co-Head of Institutional Sales, USA,
John Ricketts
Senior Vice President,
Co-Head of Institutional Sales, USA
Anna Kirk
Chief Compliance Officer
& Head of Client Service
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NS Partners Ltd.
December 8th, 2021