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SFGIX is still just 2.77% of my portfolio. You others surely have noticed that it's going nowhere fast--- for quite a while, now. Today, it was my only equity fund that sat still and did nothing, AGAIN. Any new insights, encouragements, or reasons to dump it? I know there was a shareholders phone call lately....
I like the space(s) this is exploring, so I think a better question might be if there are other diversified EM funds who are doing, or can do, a better job...assuming you want a diversified EM fund. Most EM funds are really lagging this year, but that's ok.
I own this...but am watching how Foster does in comparison with MACSX. I am also watching as to how they do outside of Asia, compared with others in those same markets. As I have a few other Matthews funds, at some point something will be jettisoned, but not sure what.
What is your time horizon for this investment? Over the long term, some investments will perform well while others lag. Emerging markets have been suffering a bit lately, while U.S. stocks are leaving everything in the dust. When and if the U.S. market corrects, emerging markets may do well. That's why we diversify.
According to M*, it is beating its category (EM diversified) by 5.84% over the past year. A year isn't much, but that's pretty damned successful in my book. Now, emerging markets have had a bad year, and they might have a few more bad years, but this fund is delivering what it promised: superior EM exposure.
Most all of EM equity went nowhere or down for a large part of the year, right? It seems that sfgix returns are inline with other funds of that style. VXF is up 30something % so that seems fairly non-correlated. If the ER was lower I would buy it but I am currently trying to buy NEWFX (LW)and or Mathews Asia G&I. 5%-10% EM equity may be sufficient depending on your age so your amount in EM may be just right. Fwiw.
SFGIX has over 50% of its holdings in emerging markets, which likely are dragging it down. I have two EM funds, ODVYX which is up 6.3% ytd and ABEMX which is down 8.1% ytd, very different from each other. I suspect emerging markets is similar to "large cap" or "small cap" each manager performs differently unless they are strictly following an index, in which case just buy the index and don't pay the higher fees. It seems when one of them starts to zig, the other zags. Emerging market is not for the faint of heart . It represents only 4.5% of my retirement portfolio ( my largest componenet). My developed market funds did much better OAKIX, at 26.4% ytd. If you bought it to give you diversification, hang onto it, its going to be a bumpy ride at times.
All the input is appreciated. I still own a big pile of EM. I bought SFGIX to diversify WITHIN E.M. beyond Asia. Seems to me Foster's bet(s) on some miners is having a negative effect. How long can platinum stay depressed?..... I'm just looking to compare, as PRESSmUP mentioned: SFGIX ytd is at +3.64% while MACSX is +3.22%...... On the other hand, my MAPIX is up ytd +9.99% and so, THAT'S what I'm looking for. But I realize that MAPIX is restricted to Asia. Thanks, folks.
MAPIX has substantially more developed markets exposure than MACSX and SFGIX and so that's why it's up more this year. Take Japan as an example which has done great this year and in which MAPIX has a sizable allocation to.
2 very good EM funds with top of the class risk-adjusted performances and mentioned quite a bit the past couple of years has been HIEMX (Virtus Emerging Markets Opportunities) and ABEMX (Aberdeen Emerging Markets) but yet both are down 7-8% YTD --- which is telling of how the emerging markets as a whole has performed this year. Take Chile for example which is down 25% YTD for the iShares Chile Index. The iShares Brazil Index is down 18% YTD.
Not much more you can ask of an EM oriented fund if it has returned +3% this year which is actually pretty good. MAPIX has a different focus - dividends and dividend growth across Asia and thus has much more developed markets exposure than MACSX and SFGIX.
According to my analysis, SFGIX is a solid fund and I would not be in a hurry to sell it.
Using EzBacktest, here are the data for select diversified EM equity funds since the inception of SFGIX on 2/15/2012, listed in order of highest to lowest Sharpe Ratio:
Nice analysis. Your highlighting the relatively poor performance of EM components in broader based funds brings to mind David's request for a large cap int'l fund with solid EM exposure.
In light of the poor EM performance, D&C Int'l (DODFX)'s top decile performance YTD looks all the more impressive. Fewer than half a dozen broad based large cap int'l funds with significant EM exposure (>10%) bested it this year: NBQAX, FAERX, QIVAX, PMIEX, and what I believe is (or was?) a well-liked fund here, Longleaf Int'l (LLINX). That latter one is the only noload, though they are all high cost funds.
Interestingly, the M* analysis of that fund says it no longer completely hedges currency - so if it got the hedging right this year (protect against falling EM/Japanese currency, but stay exposed to EU), that could explain some of its good performance this year.
In any case, the fact that a few funds can excel in spite of headwinds shows that both stockpicking and market weighting are important factors. Given that the average Pacific Asia ex-Japan fund is up only 0.58% YTD (and forget about Latin America and India, down 12% each), I agree that the 3% returns of SFGIX and MACSX are very healthy.
Another, shorter-term consideration: SFGIX has about 1/3 of assets and MACSX about 1/2 in some of the most (short-term, based on 50d ma) oversold markets worldwide, per Bespoke Investment --- SE Asia, Taiwan, & S. Korea. They can always keep going down, of course, but a bounce sometime in the near future wouldn't be too surprising.
I'm holding SFGIX, reallocating a bit from MAPIX to MACSX, and getting interested in TGMEX.
Comments
I own this...but am watching how Foster does in comparison with MACSX. I am also watching as to how they do outside of Asia, compared with others in those same markets. As I have a few other Matthews funds, at some point something will be jettisoned, but not sure what.
2 very good EM funds with top of the class risk-adjusted performances and mentioned quite a bit the past couple of years has been HIEMX (Virtus Emerging Markets Opportunities) and ABEMX (Aberdeen Emerging Markets) but yet both are down 7-8% YTD --- which is telling of how the emerging markets as a whole has performed this year. Take Chile for example which is down 25% YTD for the iShares Chile Index. The iShares Brazil Index is down 18% YTD.
Not much more you can ask of an EM oriented fund if it has returned +3% this year which is actually pretty good. MAPIX has a different focus - dividends and dividend growth across Asia and thus has much more developed markets exposure than MACSX and SFGIX.
According to my analysis, SFGIX is a solid fund and I would not be in a hurry to sell it.
Using EzBacktest, here are the data for select diversified EM equity funds since the inception of SFGIX on 2/15/2012, listed in order of highest to lowest Sharpe Ratio:
Fund: Total Return/Standard Deviation/Sharpe Ratio
THDIX: 25.4/14.3/0.64
SFGIX: 14.9/13.1/0.63
MNEMX: 4.1/15.0/0.42
EMRIX: 21.3/14.9/0.37
DREGX: 11.1/14.1/0.35
DEMIX: 14.5/17.8/0.34
ODVYX: 13.6/14.9/0.32
HLEMX: 7.3/14.7/0.23
EITEX: 7.3/14.4/0.08
CNWIX: 5.9/10.6/0.05
ABEMX: 1.7/16.6/0.01
CEMIX: 3.2/16.1/0.00
LZEMX: 1.3/16.0/0.00
HIEMX: 1.0/15.3/-0.07
Kevin
In light of the poor EM performance, D&C Int'l (DODFX)'s top decile performance YTD looks all the more impressive. Fewer than half a dozen broad based large cap int'l funds with significant EM exposure (>10%) bested it this year: NBQAX, FAERX, QIVAX, PMIEX, and what I believe is (or was?) a well-liked fund here, Longleaf Int'l (LLINX). That latter one is the only noload, though they are all high cost funds.
Interestingly, the M* analysis of that fund says it no longer completely hedges currency - so if it got the hedging right this year (protect against falling EM/Japanese currency, but stay exposed to EU), that could explain some of its good performance this year.
In any case, the fact that a few funds can excel in spite of headwinds shows that both stockpicking and market weighting are important factors. Given that the average Pacific Asia ex-Japan fund is up only 0.58% YTD (and forget about Latin America and India, down 12% each), I agree that the 3% returns of SFGIX and MACSX are very healthy.
http://www.seafarerfunds.com/fund/shareholder-letter
I'm holding SFGIX, reallocating a bit from MAPIX to MACSX, and getting interested in TGMEX.